Pineapple Financial Inc. Income Taxes Disclosure

19. Income taxes

 

The reconciliation of the combined federal and state income tax rate of 26.5% (2024 – 26.5%) to the effective tax rate is as follows:

 Schedule of federal and state income tax rate

		August 31, 2025				August 31, 2024
		$				$
(Loss) before recovery of income taxes			(3,638,465	)			(4,102,659	)
Expected income tax (recovery) expense			(964,193	)			(1,087,200	)
Non-deductible expenses			265,113				112,110
Share issuance cost booked directly to equity			(129,125	)			(219,330	)
Valuation Allowance			828,205				1,194,420
Income tax expense (recovery)			-				-

 

Deferred income taxes

 

The following table summarizes the component of deferred tax

 Schedule of deferred income taxes

		August 31, 2025				August 31, 2024
		$				$
Deferred tax assets
Intangible assets			210,730				54,750
Property, plant and equipment			9,760				-
Finance lease liabilities			185,489				258,930
Convertible debentures			-				6,550
Investments			3,972				5,240
Share issuance costs			299,391				413,950
Operating tax losses carried forward			3,419,095				2,633,950
SR&ED Pool from T661			271,748				271,750
Charitable donations carryforward			28,216				28,010
Deferred income tax assets			4,428,402				3,673,130
Valuation allowance			(4,287,909	)			(3,440,100	)
Total net deferred tax assets			140,493				233,030
Deferred tax liabilities
Property, plant and equipment			-				(13,430	)
Right of use assets			(140,493	)			(219,600	)
Total deferred tax liability			(140,493	)			(233,030	)
Net deferred tax liability			-				-

 

The Canadian operating tax loss carry forward expire in 2045. The remaining deductible temporary differences may be carried forward indefinitely.

 

The Company has adopted the provisions of ASC 740-10, which clarifies the accounting for uncertain tax positions. ASC 740-10 requires that the Company recognize the impact of a tax position in its financial statements if the position is more likely than not to be sustained upon examination based on the technical merits of the position. For the year ended August 31, 2025, the Company had no material unrecognized tax benefits, and based on the information currently available, no significant changes in unrecognized tax benefits are expected in the next 12 months.

 

 

Pineapple Financial Inc.

Notes to the Consolidated Financial Statements

For the years ended August 31, 2025 and 2024

(Expressed in US Dollars)