Gold Reserve Declares Receipt of Proposal Letter From the Canada Income Company to Reassess

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PEMBROKE, Bermuda — Gold Reserve Ltd. (TSX.V: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Firm”) declares that it obtained a letter dated November 14, 2024 (the “Proposal Letter”) from the Canada Income Company (the “CRA”) advising that, topic to submissions by Gold Reserve, the CRA proposes to reassess the Firm to incorporate in its revenue sure quantities, together with quantities in respect of the September 2014 arbitral award (“Arbitral Award”) and/or the Firm’s settlement settlement with Bolivarian Republic of Venezuela. As beforehand disclosed, the Firm has been beneath examination by the CRA in extra of three years. The Proposal Letter was obtained subsequent to the Firm’s continuance from Alberta, Canada to Bermuda.

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The Proposal Letter consists of a number of different bases of evaluation, in respect of the 2014, 2016, 2017 and 2018 taxation years of the Firm. The utmost potential revenue inclusion quantities as set out within the Proposal Letter are the total quantity of the Award of US$740.3 million, the gross sales proceeds of the mining information associated to the Brisas Challenge of US$240 million, a Cdn$50.1 million 2017 shareholder profit and a Cdn$163.2 million 2018 shareholder profit (unique of curiosity and any penalties); nevertheless these quantities don’t have in mind any deductions or changes which may be out there to the Firm to scale back the quantity of the proposed revenue inclusions. Within the roughly ten years for the reason that Award was granted, the Firm has obtained roughly $14 million pursuant to the Award. The Firm’s U.S. subsidiary obtained US$240 million associated to the mining information and reported such quantity as taxable revenue. Right now, given the a number of different bases of evaluation proposed, we’re unable to estimate the potential tax affect however are working diligently together with our advisors to take action. The matter is extremely unsure, significantly given the weird nature of the proposed different assessments. The CRA has delayed reassessment of the above proposed audit changes to January 31, 2025 to offer the Firm a possibility to answer the Proposal Letter.

The Firm is making ready to defend its earlier tax submitting positions and assessing the potential outcomes of this matter. The Firm will reply to the Proposal Letter and, failing a decision of the matter, the CRA could proceed to problem a discover of reassessment. If the CRA reassesses the Firm as described within the Proposal Letter, the Firm may have 90 days from the issuance of the discover of reassessment to organize and file a discover of objection which might be reviewed by CRA’s Appeals Division. At the moment, the Firm can be required to pay 50% of the assessed tax legal responsibility and curiosity as a way to preclude CRA from initiating collections motion. This fee, if made, would have a cloth antagonistic affect on the monetary place of the Firm and will result in substantial doubt concerning the Firm’s potential to proceed as a going concern. If the CRA isn’t in settlement with the Firm’s discover of objection, inside the prescribed interval, the Firm would have the proper to enchantment to the Tax Court docket of Canada. If a discover of reassessment is obtained, the Firm presently estimates that the final word decision of the matter could take two to 4 years. If the Firm is finally profitable in defending its place, then any taxes, curiosity and penalties paid to CRA can be refunded plus curiosity. If CRA is profitable, then any taxes payable plus curiosity and any penalties must be remitted. This may have a cloth antagonistic affect on the monetary place of the Firm and will result in substantial doubt concerning the Firm’s potential to proceed as a going concern.

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Figuring out our tax liabilities requires the interpretation of advanced tax rules and vital judgment by administration. There isn’t any assurance that the CRA tax examinations to which we’re presently topic will end in favorable outcomes.

Cautionary Assertion Concerning Ahead-Trying statements

This launch accommodates “forward-looking statements” inside the that means of relevant U.S. federal securities legal guidelines and “forward-looking data” inside the that means of relevant Canadian provincial and territorial securities legal guidelines and state Gold Reserve’s and its administration’s intentions, hopes, beliefs, expectations or predictions for the long run. Ahead-looking statements are essentially primarily based upon a lot of estimates and assumptions that, whereas thought-about cheap by administration presently, are inherently topic to vital enterprise, financial and aggressive uncertainties and contingencies. They’re often characterised by phrases equivalent to “anticipates”, “plan”, “proceed”, “count on”, “venture”, “intend”, “imagine”, “anticipate”, “estimate”, “could”, “will”, “potential”, “proposed”, “positioned” and different related phrases, or statements that sure occasions or circumstances “could” or “will” happen. Ahead-looking statements contained on this press launch embrace, however will not be restricted to, statements regarding the Proposal Letter, any CRA reassessments (together with potential tax liabilities relating thereto), timing of the decision thereof, the Firm’s monetary place and talent to proceed as a going concern.

We warning that such forward-looking statements contain recognized and unknown dangers, uncertainties and different dangers which will trigger precise occasions, outcomes or ends in Gold Reserve to be materially totally different from out estimated outcomes, outcomes, efficiency, or achievements expressed or implied by these forward-looking statements, together with however not restricted to, the affect of potential revenue tax liabilities (together with the affect on the Firm’s monetary place and talent of the Firm to proceed as a going concern) if the Firm is liable beneath the assessments both as proposed within the Proposal Letter or pursuant to a special foundation of evaluation, the Firm’s response to the Proposal Letter (together with its tax submitting positions), the Firm’s intention to defend potential reassessments if issued by CRA, any changes or deductions which may be out there to the Firm to scale back quantities payable beneath any reassessments, potential audits of different taxation years of the Firm and the size of time it might take to resolve the problems raised within the Proposal Letter or any subsequent objection to or enchantment of reassessment.

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For a extra detailed dialogue of the chance elements affecting the Firm’s enterprise, see the Firm’s administration data round dated August 20, 2024, the Firm’s Administration’s Dialogue & Evaluation for the 9-month interval ended June 30, 2024, the Annual Data Kind on Kind 40-F and Administration’s Dialogue & Evaluation for the yr ended December 31, 2023 and different stories which were filed on SEDAR+ and can be found beneath the Firm’s profile at www.sedarplus.ca and which have been filed on EDGAR and can be found beneath the Firm’s profile at www.sec.gov/edgar.

Traders are cautioned to not put undue reliance on forward-looking data or statements. All subsequent written and oral forward-looking statements attributable to Gold Reserve or individuals performing on its behalf are expressly certified of their entirety by this discover. Gold Reserve disclaims any intent or obligation to replace publicly or in any other case revise any forward-looking data or statements or the foregoing listing of assumptions or elements, whether or not because of new data, future occasions or in any other case, topic to its disclosure obligations beneath relevant guidelines promulgated by the Securities and Alternate Fee and relevant Canadian provincial and territorial securities legal guidelines.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

View supply model on businesswire.com: https://www.businesswire.com/information/residence/20241126823511/en/

Contacts

For additional data relating to Gold Reserve Ltd., please contact:

Paul Rivett
(800) 625-9550
Rosebank Centre, fifth Ground, 11 Bermudiana Street, Pembroke HM 08, Bermuda
investorrelations@goldreserve.bm

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