Loss before the provision for income taxes for the years ended December 31, 2020 and 2019 consisted of the following:

	Year Ended December 31,
	2020			2019
	(in thousands)
Canada	$	(55,446	)	$	(27,355	)
Foreign	$	704		$	334
	$	(54,742	)	$	(27,021	)

A reconciliation between tax expense and the product of accounting income multiplied by the statutory income tax rate for years ended December 31, 2020 and 2019 is as follows:

	Year Ended December 31,
	2020			2019
	(in thousands)
Loss before income taxes	$	(54,742	)	$	(27,021	)
Income tax at statutory rate		26.5	%		26.5	%
Computed income tax recovery		(14,507	)		(7,160	)
Effect on income tax resulting from:
Federal investment tax credit		(2,347	)		(985	)
Accounting charges not deductible for tax purposes		346			277
Other		(306)			(16	)
Change in valuation allowance		15,489			8,079
Tax (benefit) expense	$	(1,325	)	$	195

During the year ended December 31, 2020, the Company applied operating loss carryforwards to offset taxable income in Canada, arising primarily from the upfront payment received from the collaboration agreement with Bristol Myers Squibb.

As of December 31, 2020, the Company had tax losses of approximately $19.2 million, which are available to offset future taxable income in Canada. The Company has not recognized the tax benefit of these losses. These losses expire as follows:


	(in thousands)
2040	$	—
2039		11,395
2038		7,053
2037		750
2036		—
Total	$	19,198

As of December 31, 2020, the Company had Scientific Research and Experimental Development (“SR&ED”) expenditures of approximately $28.2 million, respectively, for Canadian federal and Quebec purposes, which have not been deducted. These expenditures are available to reduce future taxable income and have an unlimited carryforward period. SR&ED expenditures are subject to verification by the tax authorities and, accordingly, the amounts may vary.

As of December 31, 2020, the Company had non-refundable Canadian federal investment tax credits of approximately $4.3 million, which may be utilized to reduce Canadian federal income taxes payable. The Company has not recognized the tax benefits related to the non-refundable investment tax credits. The investment tax credits expire as follows:

	(in thousands)
2040	$	1,687
2039		1,362
2038		776
2037		455
2036		24
Total	$	4,304

As at December 31, 2020, the Company had U.S. federal research and development credit carryforwards of approximately $0.8 million, which begin to expire in 2038. As of December 31, 2020, the Company also had U.S. state research and development credit carryforwards of approximately $0.2 million, which expire in 2038.

The Company’s deferred tax assets for the years ended December 31, 2020 and 2019 consisted of the following:

	2020			2019
	(in thousands)
Net operating loss carryforwards	$	5,087		$	8,442
Net research and development expenditures		7,478			4,195
Share issuance costs		4,506			78
Net federal investment tax credits		3,181			1,877
U.S. research and development tax credits		961			—
Tax basis of property and equipment in excess of carrying values		(86	)		(204	)
Operating lease right-of-use assets		(1,240	)		(279	)
Operating lease liability		1,063			287
Accrued expense and other liabilities		345			161
Deferred revenue		15,372			—
Share-based compensation		103			—
Total deferred tax assets		36,770			14,557
Valuation allowance		(35,358	)		(14,425	)
Net deferred tax assets	$	1,412		$	132

The Company files income tax returns in Canada and in the United States. In the normal course of business, the Company could be subject to examination by federal and provincial or state jurisdictions, where applicable. There are currently no pending tax examinations. The Company may be subject to tax examination for 2016, 2017, 2018, 2019 and 2020 due to unexpired statute of limitation periods.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations for both federal taxes and the provinces and states in which the Company operates or does business in. ASC 740 states that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits.

The Company records uncertain tax positions as liabilities in accordance with ASC 740 and adjusts these liabilities when the Company’s judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of December 31, 2020 and 2019, no uncertain tax positions have been recorded in the consolidated financial statements.

The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations and comprehensive loss. As of December 31, 2020 and 2019, no accrued interest or penalties are included on the related tax liability line in the consolidated balance sheet.