8. Income Tax Provision

9 Months Ended

Dec. 31, 2018

Deferred tax assets

At December 31, 2018, the Company had net operating loss (“NOL”) carry–forwards for Federal income tax purposes of $3,467,116 that may be offset against future taxable income through 2038. The carry-forwards begin to expire in the year 2027. No tax benefit has been reported with respect to these net operating loss carry-forwards in the accompanying financial statements because the Company believes that the realization of the Company’s net deferred tax assets of approximately $728,094 was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are fully offset by a full valuation allowance.

Deferred tax assets consist primarily of the tax effect of NOL carry-forwards. The Company has provided a full valuation allowance on the deferred tax assets because of the uncertainty regarding its realization. The valuation allowance increased approximately $48,369 for the nine months ended December 31, 2018.

Components of deferred tax assets are as follows:

Net deferred taxes – Non-current	December 31, 2018
Expected income tax benefit from NOL carry-forwards	$	728,094
Less valuation allowance		(728,094	)
Deferred tax assets, net of valuation allowance	$	-

Income taxes in the statements of operations

A reconciliation of the federal statutory income tax rate and the effective income tax rate as a percentage of income before income taxes is as follows:

	December 31, 2018

Federal statutory income tax rate		21.0	%
Change in valuation allowance on net operating loss carry-forwards		(21.0	%)
Effective income tax rate	$	-

CENTAURUS DIAMOND TECHNOLOGIES, INC. 10-Q/A