Income taxes (Tables)
 12 Months Ended
Dec. 31, 2017
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Components of Tax Provision (Recovery)

The components of the income tax provision (recovery) include:

 

     2017      2016  

Current

    $ —        $ —    

Deferred

      298        (568 ) 
  

 

 

     

 

 

  
   $ 298      $ (568 ) 
Reconciliation of Combined Canadian Federal and Provincial Statutory Income Tax Rate to Effective Tax Rate

The reconciliation of the combined Canadian federal and provincial statutory income tax rate of 26.5% (2016 - 26.5%) to the effective tax rate is as follows:

 

     2017     2016  

Income before income taxes

    $ 2,789     $ (1,758 ) 

Combined statutory tax rate

      26.5 %      26.5 % 

Theoretical tax expense (recovery)

    $ 739     $ (466 ) 

Non-deductible expense:

     

Stock-based payments

      494       81  

Non-taxable income:

     

Non-taxable portion of capital gains

      (762 )      —    

Effect of provincial tax rate difference

      5       4  

Changes in unrecognized deferred tax assets

      (178 )      (187 ) 
  

 

 

    

 

 

  

Income tax expense (recovery)

    $ 298     $ (568 ) 
  

 

 

    

 

 

  

 
Summary of components of net deferred tax liability

The components of deferred tax are summarized below. Deferred tax assets and liabilities have been offset where they relate to income taxes levied by the same taxation authority and the Company has the legal right and intent to offset.

 

     2017      2016  

Deferred tax assets

      

Non-capital losses carried forward

    $ 5,690      $ 2,400  

Scientific research and experimental development

      28        28  

Financing fees

      31        —    

Deferred tax liabilities

      

Biological assets

      (986 )       (18 ) 

Inventory

      (1,989 )       (51 ) 

Equity accounted investments

      (153 )       —    

Investments

      (91 )       (696 ) 

Property, plant and equipment

      (968 )       (158 ) 

Health Canada licenses

      (2,978 )       (2,962 ) 
  

 

 

     

 

 

  

Net deferred tax liability

    $ (1,416 )     $ (1,457 ) 
  

 

 

     

 

 

  

 

 
Summary of movement in net deferred tax liability

The movement in the net deferred tax liability is provided below:

 

     2017      2016  

Balance - beginning of year

    $ 1,457      $ 195  

Recognized in income

      298        (568 ) 

Recognized in other comprehensive income

      (339 )       430  

Recognized in goodwill

      —          1,400  
  

 

 

     

 

 

  

Balance - end of year

    $ 1,416      $ 1,457  
  

 

 

     

 

 

  

 
Summary of Net Deferred Tax Asset Not Recognized
     2017      2016  

Property, plant and equipment

    $ 684      $ —    

Equity accounted investments

      —          89  

Share and debt issuance costs (i)

      2,834        1,085  

Losses carried forward (ii)

      7,814        3,833  

Other investments

      —          6  

 

(i)

Share and debt issuance costs will be fully amortized in 2022. The remaining deductible temporary differences may be carried forward indefinitely.
(ii)

For income tax purposes, the Company has losses carried forward from prior years which can be used to reduce future years’ taxable income. These losses expire as follows:
Summary of non-capital and farm losses carried forward to future years

For income tax purposes, the Company has losses carried forward from prior years which can be used to reduce future years’ taxable income. These losses expire as follows:

 

     Non-capital
losses		  

2030

    $ 32  

2031

      22  

2032

      877  

2033

      3,177  

2034

      1,782  

2035

      5,452  

2036

      6,558  

2037

      11,383  
  

 

 

  
   $ 29,283