NOTE 11. INCOME TAXES
The Company and its subsidiary file consolidated Federal and state income tax returns. The Company is registered in the State of Nevada which has no corporate income tax.
Certain tax years are subject to examination by the Internal Revenue Service and state taxing authorities. The Company does not believe there would be any material adjustments upon such examination.
As of September 30, 2017 and 2016, the Company had net operating loss carryforwards of approximately $24,857,000 and $20,446,000 respectively, to reduce Federal income tax liabilities through 2037.
A reconciliation of income taxes at statutory rates with the reported taxes is as follows:
| 2017 | 2016 | |||||||
| Loss for the year | $ | (2,610,673 | ) | $ | (3,424,105 | ) | ||
| Expected income tax (recovery) | $ | (659,000 | ) | $ | (877,000 | ) | ||
| Change in statutory, foreign tax, foreign exchange rates and other | (1,030,000 | ) | (266,000 | ) | ||||
| Permanent Difference | 143,000 | 323,000 | ||||||
| Change in unrecognized deductible temporary differences | 1,546,000 | 820,000 | ||||||
| Total income tax expense (recovery) | $ | — | $ | — | ||||
The significant components of the Company’s temporary differences, unused tax credits and unused tax losses that have not been included on the consolidated statement of financial position are as follows:
| 2017 | Expiry Date Range | 2016 | Expiry Date Range | |||||||||
| Temporary Differences | ||||||||||||
| Intangible assets | $ | 25,356,000 | No expiry date | $ | 25,218,000 | No expiry date | ||||||
| Non-capital losses available for future period | $ | 24,857,000 | 2033 to 2037 | $ | 20,446,000 | 2033 to 2036 | ||||||
Tax attributes are subject to review, and potential adjustment, by tax authorities.