TORONTO, ONTARIO--(Marketwired - Sep 4, 2015) - MacDonald Mines Exploration Ltd. ("MacDonald Mines" or the "Company") (TSX VENTURE:BMK) wishes to disclose an ongoing audit by Canada Revenue Agency ("CRA").
CRA recently conducted an audit (the "Audit") of the Company's flow-through tax expenditures for the 2010, 2011, 2012 and 2013 calendar years (the "Audit Period"). A significant portion of the audit related to the flow-through expenses renounced to subscribers (the "Subscribers") of flow-through shares (the "Flow Through Financings") during the Audit Period. MacDonald Mines wishes to provide an update as to the potential outcome of the Audit.
As a result of the Audit, CRA has proposed an adjustment to the amount of qualifying expenses that were declared by the Subscribers to the Flow-Through Financings. CRA made an initial determination, which is still to be reviewed by the Company and discussed with CRA, that there was a total shortfall during the entire Audit Period in the amount of eligible Canadian Exploration Expenses (CEE) within the meaning of such term in the Income Tax Act (Canada) of approximately $2,500,000 (the "Tentative Shortfall"). CRA proposes to review the T101 forms used by the Subscribers to claim their share of CEE on their tax returns, with the tax return for each Subscriber being re-assessed accordingly. The Company has an opportunity, if it so choses, to review and dispute amounts suggested by CRA as being not flow-through eligible. The Company's internal review is ongoing. While at this time, the Company cannot definitively quantify the full potential liability, CRA has proposed that the Company would be liable at a minimum to a Part XII.6 tax of approximately $250,000 in connection with the Tentative Shortfall.
The Company will provide further updates upon receipt of any such further communications.
On behalf of the Board of Directors
About MacDonald Mines Exploration Ltd.
MacDonald Mines Exploration Ltd is a mineral exploration company headquartered in Toronto, Ontario, Canada. The company is strategically focused on Copper and Zinc (VMS), and Nickel exploration in the Ring of Fire area of the James Bay Lowlands of Northern Ontario. The Company's common shares trade on the TSX Venture Exchange under the symbol "BMK".
Cautionary Statement: Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. The foregoing information may contain forward-looking statements relating to the future performance of MacDonald Mines Exploration Inc. Forward-looking statements, specifically those concerning future performance, are subject to certain risks and uncertainties, and actual results may differ materially from MacDonald Mines plans and expectations. These plans, expectations, risks and uncertainties are detailed herein and from time to time in the filings made by MacDonald Mines with the TSX Venture Exchange and securities regulators. MacDonald Mines does not assume any obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.