Notes to the Consolidated Financial Statements continued ANNUAL Report June 2022 Notes to the Consolidated Financial Statements 31 2. REVENUE AND OTHER INCOME Revenue 2022 $ 2021 $ Sales and hire income 4,014,380 4,522,982 Sub-lease rent (unincorporated joint venture) 54,768 17,578 Interest received – other persons/corporation 3,029 6,520 4,072,177 4,547,080 Other income: Government subsidies (various) 52,726 69,872 AMGC grant 392,000 - R&D tax offset 1,501,200 610,106 Diesel fuel rebates 205,959 191,642 Other income 7,201 - 2,159,086 871,620 Total revenue and other income 6,231,263 5,418,700 3. INCOME TAX 2022 $ 2021 $ (a) Reconciliation of income tax expense to prima facie tax payable Profit / (loss) before income tax (6,063,052) (4,574,191) Tax at the statutory rate of 25% (30 June 2021: 25%) (1,515,763) (1,189,290) Tax effect of amounts which are not taxable in calculating taxable income: Non-deductible expenses 852,912 72,656 Non-assessable income (375,300) (170,003) Deferred tax assets not recognised 1,038,151 1,286,637 Income tax benefit - - (b) Unrecognised deferred tax assets Balance at beginning of year 5,123,772 5,219,268 Current year not recognized (612,477) 669,121 Adjustments in respect of prior year tax balances - (593,284) Tax rate change 26% to 25% (Prior Year: Tax rate change from 26% to 25%) - (171,333) Balance at end of year 4,511,295 5,123,772 Deferred tax assets have not been recognized in respect of the following items: Tax losses 7,685,999 7,112,830 Less: other timing differences (3,174,703) (1,989,058) Net deferred tax assets 4,511,295 5,123,772 No provision for income tax is considered necessary in respect of the Company for the period ended 30 June 2022. Deferred tax assets have not been recognised in respect of these items because it is not probable in the short to medium term that these assets will be realised. The Group has total tax losses at 30 June 2022 of $30,743,977 (2021: $28,451,322). A future income tax benefit which may arise from tax losses of 25% of approximately $7,685,994 will only be obtained if: ▪ the parent and the subsidiaries derive future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions for the losses to be realised; ▪ the parent and the subsidiaries continue to comply with the conditions for deductibility imposed by the law; and 62 EQ Resources Limited Annual Report 2022
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