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INCOME TAX CREDIT
 12 Months Ended
Dec. 31, 2022
Disclosure of income tax credit [Abstract]  
INCOME TAX CREDIT
7.
INCOME TAX CREDIT
 
 
  
December 31,
2022
US$‘000
    
December 31,
2021
US$‘000
    
December 31,
2020
US$‘000
  
Current tax (credit)/expense
                  
Irish Corporation tax
    
(331
)
    
(511
)
    
(480
)
Foreign taxes (a)
    
(5
 )    
296
      
179
  
Adjustment in respect of prior years
    
61
      
-
      
(152
)
 
                        
Total current tax credit
    
(275
)
    
(215
)
    
(453
)
 
                        
Deferred tax credit (b)
                        
Origination and reversal of temporary differences (see Note 13)
    
321
      
620
      
48
  
Origination and reversal of net operating losses (see Note 13)
    
(238
)
    
(583
)
    
(215
)
 
                        
Total deferred tax charge/(credit)
    
83
      
37
      
(167
)
 
                        
Total income tax credit on continuing operations in statement of operations
    
(192
)
    
(178
)
    
(620
)
 
                        
Tax charge on discontinued operations (see Note 8)
    
-
      
12
      
438
  
 
                        
Total tax credit
    
(192
)
    
(166
)
    
(182
)
 
(a)
In 2022, the foreign taxes relate primarily to USA and Canada.
(b)
 
In 2022, there was a deferred tax charge of US$109,000 (2021: charge of US$118,000) (2020: credit of US$444,000) recognised in respect of Ireland and a deferred tax credit of US$26,000 (2021: credit of US$81,000) (2020: credit of US$397,000) recognised in respect of overseas tax jurisdictions.
 
Effective tax rate
  
December 31,
2022
    
December 31,
2021
    
December 31,
2020
  
(Loss)/profit before taxation – continuing operations (US$‘000)
    
(41,194
)
    
751
      
(6,633
)
As a percentage of (loss)/profit before tax:
                        
Current tax %
    
(0.67
)%
    
(28.63
)%
    
(6.83
)%
Total (current and deferred) %
    
(0.47
)%
    
(23.70
)%
    
(9.35
)%

 

The following table reconciles the applicable Republic of Ireland statutory tax rate to the effective total tax rate for the Group:
 
 
  
December 31,
2022
    
December 31,
2021
    
December 31,
2020
  
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)
    
11.66
%
    
49.63
%
    
24.13
%
Effect of tax rates on overseas earnings
    
(7.76
)%
    
(0.22
)%
    
(9.92
)%
Effect of Irish income taxable at higher tax rate
    
4.17
%
    
98.68
%
    
5.92
%
Adjustments in respect of prior years
    
0.15
%
    
(0.01
)%
    
(10.66
)%
R&D tax credits
    
(0.81
)%
    
(79.22
)%
    
(11.00
)%
Other items (b)
    
4.62
%
    
(105.06
)%
    
4.68
%
 
                        
Effective tax rate
    
(0.47
)%
    
(23.70
)%
    
(9.35
)%

 

(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 and expenses not deductible for tax purposes. This was a significant number in 2021 because the US$4.7 million income from the Paycheck Protection Program loans was not chargeable for tax purposes. There is no Paycheck Protection Program income in 2022. In 2022, other items mainly relate to the loss on disposal of the exchangeable notes.
 
The distribution of (loss)/profit before taxes by geographical area was as follows:
 
 
  
December 31,
2022
US$‘000
    
December 31,
2021
US$‘000
    
December 31,
2020
US$‘000
  
Rest of World – Ireland
    
(19,768
)
    
1,862
      
296
  
Rest of World – Other
    
(33
)
    
3,939
      
3,304
  
Americas
    
(21,393
)
    
(5,050
)
    
(10,233
)
 
                        
 
    
(41,194
)
    
751
      
(6,633
)
 
At December 31, 2022, the Group had unutilised net operating losses for continuing operations as follows:
 
 
  
December 31,
2022
US$‘000
    
December 31,
2021
US$‘000
    
December 31,
2020
US$‘000
  
Rest of World – Ireland
    
62,731
      
68,132
      
78,700
  
Rest of World – Other
    
448
      
1,000
      
2,185
  
Americas
    
12,778
      
4,761
      
4,313
  
 
                        
 
    
75,957
      
73,893
      
85,198
  

 

At December 31, 2022, the Group had unrecognised deferred tax assets in respect of unused tax losses and unused tax credits as follows:
 
 
  
December 31,
2022
US$‘000
    
December 31,
2021
US$‘000
    
December 31,
2020
US$‘000
  
Rest of World – Ireland – unused tax losses
    
7,489
      
9,272
      
12,514
  
Rest of World – Other – unused tax losses
    
124
      
279
      
546
  
Americas – unused tax losses
    
3,163
      
5,891
      
1,466
  
Americas – unused tax credits
    
4,658
      
3,368
      
2,862
  
 
            
 
      
 
  
Unrecognised deferred tax asset
    
15,434
      
18,810
      
17,388
  
 
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.