Annual report pursuant to Section 13 and 15(d)

Income Tax

v2.4.0.8
Income Tax
 12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note 8. Income Tax

(a)   Current income tax

 

The income tax expense is reconciled as below:

 

    2012     2011  
          (Restated)  
Net Loss   $ 430,790     $ 3,106,230  
Statutory tax rate     35 %     35 %
Income Tax at Statutory tax rate     150,777       1,087,181  
Non-deductible expenses     (16,398 )     (1,044,919 )
Change in valuation allowance     (134,379 )     (42,262 )
Total tax expenses     -       -  

 

The Company accounts for income taxes under ASC 740. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is "more likely than not" that some component or all of the benefits of deferred tax assets will not be realized.

 

No provision for income taxes has been provided in these consolidated financial statements due to the net loss for the years ended December 31, 2012 and 2011. The net operating loss will expire at various times to December 31, 2031.

 

(b)   Deferred tax

 

    2012     2011  
           (Restated)  
Non-capital losses carried forward   $ 2,205,282     $ 1,290,008  
Statutory tax rate     35 %     35 %
Income Tax at Statutory tax rate     771,849       451,502  
Valuation allowance     (771,849 )      (451,502 )