Notes to the Consolidated Financial Statements continued ANNUAL Report June 2023 Notes to the Consolidated Financial Statements 34 2. REVENUE AND OTHER INCOME Revenue 2023 $ 2022 $ Sales and hire income 5,039,906 4,014,380 Sub-lease rent (unincorporated joint venture) 69,259 54,768 Interest received – other persons/corporation 29,249 3,029 5,138,414 4,072,177 Other income: Government wage subsidies 322,050 52,726 AMGC grant 190,000 392,000 CMAI grant 4,824,818 - R&D tax offset 2,307,510 1,501,200 Diesel fuel rebates 336,860 205,959 Other income - 7,201 7,981,238 2,159,086 Total revenue and other income 13,119,652 6,231,263 3. INCOME TAX 2023 $ 2022 $ (a) Reconciliation of income tax expense to prima facie tax payable Profit / (loss) before income tax (3,716,846) (6,063,052) Tax at the statutory rate of 25% (30 June 2022: 25%) (929,212) (1,515,763) Tax effect of amounts which are not taxable in calculating taxable income: Non-deductible expenses 1,418,709 852,912 Non-assessable income (586,734) (375,300) Deferred tax assets not recognised 1,533,746 1,038,151 Income tax benefit 1,436,510 - (b) Unrecognised deferred tax assets Balance at beginning of year 4,511,295 5,123,772 Current year not recognised 180,749 (612,477) Adjustments in respect of prior year tax balances 638,668 - Tax rate change 26% to 25% (Prior Year: Tax rate change from 26% to 25%) - - Balance at end of year 5,330,712 4,511,295 Deferred tax assets have not been recognized in respect of the following items: Tax losses 9,772,349 7,685,998 Less: other timing differences (4,441,637) (3,174,703) Net deferred tax assets 5,330,712 4,511,295 No provision for income tax is considered necessary in respect of the Company for the period ended 30 June 2023. 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 2023 of $39,089,398 (2022: $30,743,977). A future income tax benefit which may arise from tax losses of 25% of approximately $9,772,349 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 76 EQ Resources Limited Annual Report 2023
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