Impact Minerals Ltd Annual Report 2022 53 Notes to the Consolidated Financial Statements continued NOTE 5: INCOME TAX Consolidated 2022 $ 2021 $ a) Major components of income tax expense are as follows: Current income tax expense/(benefit) – – Deferred income tax expense/(benefit) – – Income tax expense reported in the Consolidated Statement of Profit or Loss and Other Comprehensive Income – – b) The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows: Loss from ordinary activities before income tax expense (2,399,307) (4,760,174) Prima facie tax benefit on profit from ordinary activities before income tax at 25% (2021: 26%) (599,827) (1,309,048) Tax effect of permanent differences: – Share-based expense 146,350 38,180 – Non-deductible expenses 2,024 2,805 – Government grant received (61,405) (30,231) – Tax losses not recognised 512,858 1,298,294 Income tax expense/(benefit) on pre-tax profit – – c) Deferred tax assets and (liabilities) are attributable to the following: Accrued expenses 6,375 8,392 Capital raising costs 186,392 143,135 Exploration expenditure (2,949,330) (2,617,229) Plant and equipment (6,928) (6,963) Provision for employee entitlements 33,826 24,897 Other (10) 1,460 Tax losses 2,729,675 2,446,308 – – d) Unrecognised deferred tax assets Deferred tax assets have not been recognised in respect of the following items as the Directors do not believe it is appropriate to regard realisation of future tax benefits as probable: – Tax losses 6,867,006 7,029,303 – Capital losses 444,481 488,929 7,311,487 7,518,232 The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on the applicable income tax rate for each jurisdiction, adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
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