Note 15 - Income Taxes
|12 Months Ended|
Dec. 31, 2020
|Notes to Financial Statements|
|Income Tax Disclosure [Text Block]||
December 2017the U.S. government enacted comprehensive tax legislation, the Tax Cuts and Jobs Act (the "Tax Act"), which significantly revises the U.S. tax code, generally effective
January 1, 2018,by lowering the U.S. federal corporate income tax rate from
21%,implementing a territorial tax system and setting limitations on the deductibility of certain costs (e.g. Interest expenses) among other things. As a Canadian entity, we generally would be classified as a foreign entity (and, therefore, a non-U.S. tax resident) under general rules of U.S. federal income taxation. However, we have a branch and U.S. subsidiary subject to U.S. federal income taxation.
For the years ended
December 31, 2019and
2020,the total comprehensive loss is as follows:
Major items causing the Company's income tax rate to differ from the statutory rate of approximately
26.5%) are as follows:
The tax effects of temporary differences that give rise to significant portions of the unrecognized deferred tax assets are presented below:
The valuation allowance at
December 31, 2020was primarily related to net operating loss carryforwards that, in the judgment of management, are
notto be realized. In assessing the realizability of deferred tax assets, management considers whether it is more-likely than-
notthat all or some portion of the deferred assets will
notbe realized. This ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which those deductible temporary difference become deductible. Based on the history of losses and projections for future taxable income, management believes that it is
notthat the Company will realize the benefits of these deductible temporary differences (e.g. deferred tax assets).
The Company has Canadian undeducted research and development expenditures, totaling
$19.0million that can be carried forward indefinitely. The Company also has Canadian non-refundable federal and provincial investment tax credits of approximately
$3.6million which are available to reduce future federal taxes payable and begin to expire in
2021,as well as non-refundable US research and development tax credits of approximately
$0.9million which are available to reduce future US taxes payable and begin to expire in
In addition, the Company has Canadian non-capital loss carryforwards of
$135.2million. To the extent that the non-capital loss carryforwards are
notused, they begin to expire in
2026.The Company also has US non-capital loss carryforward of
$0.7million, To the extent that the non-capital loss carryforwards are
notused, they begin to expire in
The Company files income tax returns with Canada and its provinces and territories. Generally, we are subject to routine examinations by the Canada Revenue Agency ("CRA"). Income tax returns filed with various provincial jurisdictions are generally open to examination for periods of
fiveyears subsequent to the filing of the respective return.
The Company also files income tax returns for our U.S. operations and subsidiary with the U.S. federal and state tax jurisdictions. Generally, we are subject to routine examination by taxing authorities in the U.S. jurisdictions. There are presently
noexamination of our U.S. federal and U.S. state returns. We believe that our tax positions comply with the applicable tax law.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef