v3.25.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The domestic and foreign components of income (loss) before income taxes and (provision for) recovery of income taxes were as follows:
Years ended
December 31, 2024December 31, 2023December 31, 2022
(in US $ millions)
Income (loss) before income taxes
Domestic537 599 (2,553)
Foreign1,691 (414)(1,070)
2,228 185 (3,623)
Current income tax (expense) recovery
Domestic(32)1 — 
Foreign(99)(55)(24)
(131)(54)(24)
Deferred income tax recovery (expense)
Domestic(72)(2)180 
Foreign(6)3 7 
(78)1 187 
(Provision for) recovery of income taxes(209)(53)163 
The reconciliation of the expected income tax (expense) recovery calculated using the statutory tax rate to the actual (provision for) recovery of income taxes reported in the consolidated statements of operations and comprehensive income (loss) for the years ended December 31, 2024, 2023 and 2022 is as follows:
Years ended
 December 31, 2024December 31, 2023December 31, 2022
(in US $ millions)
Income (loss) before income taxes2,228 185 (3,623)
Expected income tax (expense) recovery at Canadian statutory income tax rate of 26.5%(1)
(590)(49)960 
Permanent differences
Domestic taxes on foreign earnings(49)(51)— 
Stock-based compensation15 (74)(18)
Other permanent differences(9)(6)(11)
Net unrealized gain (loss) on equity and other investments121 276 (419)
Sales of businesses— 195 — 
Foreign taxes on net unrealized gain (loss) on equity and other investments(132)— 
Foreign tax rate differential112 48 36 
Tax credits recognized during the year21 21 17 
Pillar Two tax(18)— 
U.S. State taxes
(242)— — 
Change in valuation allowance557 (409)(397)
Other items5 (4)(5)
(Provision for) recovery of income taxes(209)(53)163 
(1) Our Canadian corporate tax rate is comprised of a basic Part I federal tax rate of 38%, net 15% after federal tax abatement and general tax reduction, plus the additional provincial tax of 11.5%.
The significant components of the Company’s deferred income tax assets and liabilities as of December 31, 2024 and 2023 were as follows:
 December 31, 2024December 31, 2023
(in US $ millions)
Deferred tax assets  
Tax loss carryforwards608 806 
Accruals and reserves107 98 
Lease liabilities57 74 
Capital and intangible assets48 39 
Stock-based compensation expense37 34 
Research and development expenditures23 156 
Tax credits15 84 
Share issuance costs— 5 
Other deferred tax assets— 1 
Total deferred tax assets, before valuation allowance895 1,297 
Valuation allowance(482)(1,039)
Total deferred tax assets413 258 
Deferred tax liabilities  
Equity and other investments(294)(77)
Outside basis difference of foreign subsidiaries(125)(104)
Lease assets(25)(29)
Intangible assets— (6)
Other deferred tax liabilities(5)(4)
Total deferred tax liabilities(449)(220)
Total deferred tax (liabilities) assets, net(36)38 
During the year ended December 31, 2024, the Company assessed whether a valuation allowance should be established or maintained against its deferred tax assets, based on consideration of all available positive and negative evidence, using a "more-likely-than-not" standard. The factors the Company uses to assess the likelihood of realization are its recent operating results, historical losses and the cumulative losses, forecasts of future pre-tax income and tax planning strategies that could be implemented to realize the deferred tax assets.
The Company had a provision for income taxes of $209 million in the year ended December 31, 2024, on account of earnings and unrealized gains on the company's equity and other investments, net of an offset to the reversal of valuation allowance.
During the year ended December 31, 2024, there were significant unrealized gains on the Company's equity and other investments resulting in a deferred tax expense. As a result, a portion of the valuation allowance was reversed which partially offset the deferred tax expense in the current year.
During the year ended December 31, 2024, the Company performed a U.S. state tax sourcing analysis that resulted in a change to our U.S. state tax apportionment. This also resulted in a reduction in deferred tax assets, including unused non-capital tax losses, that were fully offset by a valuation allowance.
The Organization for Economic Co-operation and Development continues to advance efforts with respect to the global minimum tax framework ("Pillar Two"). On June 20, 2024, Canada enacted legislation in accordance with the Pillar Two framework. Many countries have also enacted or are expected to enact Pillar Two legislation. The Company continues to monitor the development and implementation of these rules both in local countries and on a multilateral basis, making it uncertain to predict the ultimate impact in the future. For the year ended December 31, 2024, the Company has recorded incremental tax relating to Pillar Two in the amount of $18 million.
During the year ended December 31, 2023, the Company had a provision for income taxes of $53 million, primarily on account of earnings in jurisdictions outside of North America.
During the year ended December 31, 2022, as a result of the application of the Company's tax rates to the results of ongoing operations, other discrete items primarily related to unrealized non-deductible losses on equity and other investments, share-based compensation and change in valuation allowance related to deferred tax assets in Canada as well as the United States, the Company had a recovery for income taxes of $163 million.
During the year ended December 31, 2022, and following the reversal of a large portion of the unrealized gains on the Company’s equity and other investments, a valuation allowance was recorded against the excess of the Company's Canadian deferred income tax assets relative to its deferred income tax liabilities as the Company has a history of operating losses.
The Company receives a development and expansion incentive under the International Headquarters Award in Singapore. The incentives granted by the authorities to the Company expires March 31, 2026 and provide a concessionary tax rate of 5% to earnings in excess of the base income threshold. As a result of the incentive, the Company received an aggregate tax benefit of $21 million, $9 million and $2 million during the year ended December 31, 2024, 2023 and 2022, respectively.
The Company had no material uncertain income tax positions for the years ended December 31, 2024 and 2023. The Company's accounting policy is to recognize interest and penalties related to uncertain tax positions as a component of income tax expense. In the years ended December 31, 2024 and 2023, there was no material interest or penalties related to uncertain tax positions.
The Company remains subject to audit by the relevant tax authorities for the years ended 2017 through 2024.
Investment tax credits, which are earned as a result of qualifying research and development expenditures, are recognized and applied to reduce income tax expense in the year in which the expenditures are made and their realization is reasonably assured.
As of December 31, 2024 and 2023, the Company had Canadian unused non-capital tax losses of approximately $5 million and $117 million, respectively. As of December 31, 2024 and 2023, the Company had U.S. federal unused non-capital tax losses of approximately $306 million and $383 million, respectively. In addition, as of December 31, 2024 and 2023, the Company had unused non-capital tax losses in various U.S. states of approximately $339 million and $1.5 billion, respectively. As of December 31, 2024, $272 million and $6 million of the federal and state non-capital tax losses, respectively, have no expiry. The remaining unused federal and state non-capital tax losses of $34 million and $333 million, respectively, will begin to expire starting in 2031. As of December 31, 2024, the Company also has $761 million of capital losses in Canada that do not expire as well as $1.7 billion of capital losses in the U.S. that expires in 2028. In addition, as of December 31, 2024 and 2023, the Company had an undeducted Canadian research and development expenditure balance totaling $nil and $226 million, respectively. As of December 31, 2024 and 2023, the Company had Canadian and U.S. federal and state tax credits of $33 million and $104 million, respectively. The unused U.S. federal tax credits will begin to expire in 2042 and the unused U.S. state research and development credits will begin to expire starting in 2029. The unused Canadian investment tax credits will begin to expire starting in 2043.