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Deferred Tax and Income Tax

12 Months Ended

Jun. 30, 2024

Deferred Tax and Income Tax [Abstract]

Note 21. Deferred tax and Income tax

The roll forward of net deferred tax as of June 30, 2024 and 2023 is as follows:

	2024			2023
Balance at beginning of year	$	1,071,807		$	—
Incorporated through the business combination		—			1,297,436
Credited to profit & loss		(1,046,985	)		(234,542	)
Charged to Other Comprehensive Income		47,274			8,913
Balance at year end	$	72,096		$	1,071,807

Principal statutory taxes rates in the countries where the Group operates for all the years presented are:

Tax Jurisdiction	2024	2023	2022
Argentina	25% – 35%	25% – 35%	—
Luxembourg	15% – 17%	15% – 17%	—
United Kingdom	19%	19%	19%

Reconciliation of effective tax rate

The Group’s reconciliation of the effective tax rate is based on its domestic tax rate, with a reconciling item in respect of tax rates applied by Group companies in other jurisdictions.

The tax rate used for 2024 represents the corporate tax rate of 15% from Luxembourg on the taxable income payable by the Group, in accordance with the tax laws of said jurisdiction. Income tax for other jurisdictions is calculated based on the substantially enacted nominal tax rates prevailing in the respective jurisdictions.

	As of June 30, 2024			As of June 30, 2023			As of June 30, 2022
Loss before tax	$	(8,359,245	)	$	(52,023,422	)	$	(4,526,905	)
Corporate tax rate		15	%		15	%		19	%
Income tax (benefit)/expense		1,253,887			7,803,513			860,112
Effect of difference tax rates subsidiaries operating in other jurisdictions		324,182			428,506			—
Tax losses(i)		(1,921,890	)		(1,631,947	)		(860,112	)
Non-deductible expenses – listing cost		—			(6,405,759	)		—
Net gain on inflation effect on monetary items		738,674			52,914			—
Income tax inflation adjustment		524,342			(35,826	)		—
Others		127,790			23,141			—
Tax benefit for the year	$	1,046,985		$	234,542		$	—

(i) Deferred tax assets have not been recognized, because it is not probable that future taxable profit will be available against which the Group can use the benefits therefrom

Deferred tax

Deferred tax assets and liabilities are recognized when the carrying amount of an asset or liability in the Consolidated statement of financial position differs from its tax base, except for differences arising on the initial recognition of goodwill.

Net deferred tax liabilities are comprised of the following amounts:

	As of June 30, 2024		As of June 30, 2023
Deferred tax asset
Tax loss carry-forward		777,515		292,267
Other tax receivables		6,892		—
Total other receivables	$	784,407	$	292,267

Deferred tax liability
Customer relationship		845,069		1,346,374
Fixed assets		11,434		—
Other tax liabilities		—		17,700
Total deferred tax liability	$	856,503	$	1,364,074
Net deferred tax liability	$	72,096	$	1,071,807

The following table shows the expiration date of the recognized accumulated tax loss carryforwards pursuant to statutes of limitations:

Fiscal year	Tax-loss carry forward		Deferred tax asset		Expiration date	Tax jurisdiction
2022		3,086		771	2027	Argentina
2023		1,806,586		451,646	2028	Argentina
2024		1,300,390		325,098	2029	Argentina
Total	$	3,110,061	$	777,515

Unrecognized deferred tax assets

As of June 30, 2024, 2023 deferred tax assets relating to the operating company in the UK, Luxembourg and Argentina (Moolec Science S.E.) aren’t recognized because it is not probable that future taxable amounts will be available to utilize those temporary differences and losses. Therefore, in the present Consolidated Financial Statements, the Company decided not to recognize deferred income tax assets generated by the tax loss carry forward for the periods ended on June 30, 2024 and 2023 for the amounts of $1,921,890 and $ 7,601,790 respectively.

Deferred tax assets have not been recognized in respect of the following items, because it is not probable that future taxable profit will be available against which the Group can use the benefits therefrom:

	2024		2023
Tax losses per country	Gross amount	Tax effect	Gross amount	Tax effect
United Kingdom(1)	15,405,401	2,927,026	11,536,344	2,191,905
Luxembourg(2)	46,434,435	6,965,165	42,751,716	6,412,757
Argentina	2,791,314	697,829	253,868	63,468
Total	64,631,150	10,590,020	54,541,928	8,668,130

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(1) In the UK losses may be carried forwards indefinitely. The use of carried forwards losses is restricted to 50% of profits above a groupwide GBP 5 million allowances per year.

(2) In Luxembourg losses may be carried forward for 17 years.