v2.4.0.6
10. Income taxes:
12 Months Ended
Dec. 31, 2012
Income Tax Disclosure [Text Block]
10.   Income taxes:

The provision for income taxes differs from the result that would be obtained by applying the statutory tax rate of 34% (2011 - 34%) to income before income taxes. The difference results from the following items:

 
 
2012
 
2011
Computed expected benefit of income taxes
$
(2,831,744)
$
(1,794,067)
Stock-based compensation
 
1,903,205
 
912,048
Non-deductible interest expense
 
57,544
 
60,949
Increase in valuation allowance
 
870,995
 
821,070
Income tax provision
$
-
$
-

The components of the net deferred income tax asset, the statutory tax rate and the amount of the valuation allowance are as follows:

 
 
2012
 
2011
Net operating loss carried forward
$
28,685,595
$
26,123,845
Tax rate
 
34%
 
34%
Deferred income tax assets
 
9,753,102
 
8,882,107
Valuation allowance
 
(9,753,102)
 
(8,882,107)
Net deferred income tax asset
$
-
$
-

The potential benefit of the deferred income tax asset has not been recognized in these financial statements since it cannot be assured that it is more likely than not that such benefit will be utilized in future years.

The Company believes that the available objective evidence creates sufficient uncertainty regarding the realizability of the deferred income tax assets such that a full valuation allowance has been recorded.

The operating losses amounting to $28,789,460 for utilization in the United States of America, the jurisdiction where they were incurred, will expire between 2019 and 2032 if they are not used. The following table lists the fiscal year in which the loss was incurred and the expiration date of the operating loss carry-forwards:

Fiscal Year
 
Amount
Expiry Date
1999
$
88,022
2019
2000
 
4,425,866
2020
2001
 
3,681,189
2021
2002
 
2,503,951
2022
2003
 
2,775,900
2023
2004
 
1,250,783
2024
2005
 
1,304,238
2025
2006
 
1,532,322
2026
2007
 
1,479,818
2027
2008
 
1,599,919
2028
2009
 
1,723,146
2029
2010
 
1,343,733
2030
2011
 
2,414,913
2031
2012
 
2,561,750
2032
Total
$
28,685,595