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INCOME TAX CREDIT
 12 Months Ended
Dec. 31, 2021
Disclosure of income tax credit [Abstract]  
INCOME TAX CREDIT
9.
INCOME TAX CREDIT
 
 
 
  
December 31, 2021
US$‘000
    
December 31, 2020
US$‘000
    
December 31, 2019
US$‘000
  
Current tax (credit)/expense
                  
Irish Corporation tax
     (511
)
     (480
)
     (312
)
Foreign taxes (a)
     296       179       197  
Adjustment in respect of prior years
     -
 
     (152
)
     (50
)
 
                        

Total current tax credit

     (215
)
     (453
)
     (165
)
 
                        
Deferred tax credit (b)
                        
Origination and reversal of temporary differences (see Note 15)
     620       48       (625
)
Origination and reversal of net operating losses (see Note 15)
     (583
)
     (215
)
     (216
)
 
                        

Total deferred tax credit

     37
 
     (167
)
     (841
)
 
                        
Total income tax credit on continuing operations in statement of operations
     (178
)
     (620
)
     (1,006
)
 
                        
Tax charge on discontinued operations (see Note 10)
     12       438       -  
 
                    
 
  
Total tax credit
     (166
)
     (182
)
     (1,006
)
 
  (a)

In 2021, the foreign taxes relate primarily to USA and Canada.
  (b)
In 2021, there was a deferred tax charge of US$118,000 (2020: charge of US$53,000; 2019: credit of US$444,000) recognised in respect of Ireland and a deferred tax credit of US$81,000 (2020: credit of US$220,000;2019: credit of US$397,000) recognised in respect of overseas tax jurisdictions.
 
Effective tax rate
  
December 31, 2021
    
December 31, 2020
    
December 31, 2019
  
Profit/(Loss) before taxation – continuing operations (US$‘000)
     751
 
     (6,633
)
     (29,997
)
As a percentage of loss before tax:
                        
Current tax %
     28.63
%
     (6.83
)%
     (0.55
)%
Total (current and deferred) %
     (23.70
)%
     (9.35
)%
     (3.36
)%
 
The following table reconciles the applicable Republic of Ireland statutory tax rate to the effective total tax rate for the Group:
 
 
  
December 31, 2021
    
December 31, 2020
    
December 31, 2019
  
Irish corporation tax
     12.5
%
     (12.5
)%
     (12.5
)%
Effect of current year net operating losses and temporary differences for which no deferred tax asset was recognised (a)
     49.63
%
     24.13
%
     13.21
%
Effect of tax rates on overseas earnings
     (0.22
)%
     (9.92
)%
     (3.05
)%
Effect of Irish income taxable at higher tax rate
     98.68
%
     5.92
%
     0.04
%
Adjustments in respect of prior years
     (0.01
)%
     (10.66
)%
     (0.17
)%
R&D tax credits
     (79.22
)%
     (11.00
)%
     (2.69
)%
Other items (b)
     (105.06
)%
     4.68
%
     1.80
%
 
                        
Effective tax rate
     (23.70
)%
     (9.35
)%
     (3.36
)%
 
  (a)
No deferred tax asset was recognised because there was no reversing deferred tax liability in the same jurisdiction reversing in the same period and insufficient future projected taxable income in the same jurisdiction.
 
   (b)

Other items comprise items not chargeable to tax/expenses not deductible for tax purposes. In 2021, this mainly comprises the income from the Paycheck Protection Program loans which is not chargeable for tax purposes.

 

The distribution of profit/(loss) before taxes by geographical area was as follows:
 
 
  
December 31, 2021
US$‘000
    
December 31, 2020
US$‘000
    
December 31, 2019
US$‘000
  
Rest of World – Ireland
     1,862       296       (20,318
)
Rest of World – Other
     3,939       3,304       4,760  
Americas
     (5,050
)
     (10,233
)
     (14,439
)
 
                        
 
     751
 
     (6,633
)
     (29,997
)
 
At December 31, 2021, the Group had unutilised net operating losses for continuing operations as follows:
 
 
  
December 31, 2021
US$‘000
    
December 31, 2020
US$‘000
    
December 31, 2019
US$‘000
  

Rest of World – Ireland

     68,132       78,700       73,754  

Rest of World – Other

     1,000       2,185       -  

Americas

     4,761       4,313       6,823  
 
                        
 
     73,893       85,198       80,577  

 

 
At December 31, 2021, the Group had unrecognised deferred tax assets in respect of unused tax losses and unused tax credits as follows:
 
 
  
December 31, 2021
US$‘000
    
December 31, 2020
US$‘000
    
December 31, 2019
US$‘000
  

Rest of World – Ireland – unused tax losses

     9,272       12,514       12,062  

Rest of World – Other – unused tax losses

     279       546       -  

Americas – unused tax losses

     5,891       1,466       5,259  

Americas – unused tax credits

     3,368       2,862       493  
                         
Unrecognised deferred tax asset
     18,810       17,388       17,814  
 
The accounting policy for deferred tax is to calculate the deferred tax asset that is deemed recoverable, considering all sources for future taxable profits. The deferred tax assets in the above table have not been recognised due to uncertainty regarding the full utilization of these losses in the related tax jurisdiction in future periods. Only when it is probable that future profits will be available to utilize the forward losses or temporary differences is a deferred tax asset recognised. When there is a reversing deferred tax liability in that jurisdiction that reverses in the same period, the deferred tax asset is restricted so that it equals the reversing deferred tax liability.