v3.25.1
Taxes on Income
 12 Months Ended
Dec. 31, 2024
Taxes on Income [Abstract]  
TAXES ON INCOME

NOTE 13 – TAXES ON INCOME

 

a. The Israeli corporate tax rate is 23%.

 

b. The Company has not paid income taxes since its incorporation. Tax assessments through the year ended December 31, 2018 are deemed to be final.

 

c. The Parent and its subsidiaries are taxed separately.

 

The Company measures its results for tax purposes in nominal terms in NIS based on financial reporting under Israeli accounting principles; therefore, there are differences between the Company’s taxable income (loss) and income (loss) reflected in these financial statements.

 

As of December 31, 2024, the Parent had the following loss carry-forwards:

 

(i)Approximately $40 million deductible only against sale of assets and/or activities in connection with income generated from its clinical development programs prior to the Company’s merger transaction in March 2019.

 

(ii)Approximately $19 million, arising after the Company’s merger transaction in March 2019, deductible from future taxable income.

 

As of December 31, 2024, Enlivex Therapeutics R&D Ltd. and Enlivex Therapeutics RDO Ltd. had loss carry-forwards amounting to approximately $58 million and $1.7 million, respectively, deductible from future taxable income.   These losses carry-forward have no expiration date.  

 

d. The components of the provision for income taxes are as follows:

 

    Year ended December 31, 
(in thousands)   2024    2023    2022 
Current tax  $
-
   $
-
   $
-
 
Deferred tax   
-
    
-
    
-
 
Provision for income taxes, net  $
-
   $
-
   $
-
 

 

e. A reconciliation between the Company’s effective tax rate and the statutory rate are as follows:  

 

   Year ended December 31, 
   2024   2023   2022 
Statutory tax rate   23%   23%   23%
Permanent differences   1%   1%   
-
%
Exchange rate differences   
-
%   (3)%   (3)%
Change in valuation allowance   (24)%   (21)%   (20)%
Effective tax rate   
-
    
-
    
-
 

 

f. Deferred income taxes:  

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial purposes and the amounts used for income tax purposes.

 

As of December 31, 2024, the Company had provided a full valuation allowance in respect of deferred tax assets. Management currently believes that because the Company has a history of losses, it is more likely than not that the deferred tax regarding the loss carry-forward and other temporary differences will not be realized for the foreseeable future.

Components of the Company’s deferred tax liabilities and assets are as follows:

 

   Year ended December 31, 
(in thousands)  2024   2023 
Tax assets in respect of:        
Accrued employees’ and directors’ compensation  $324   $205 
Stock based compensation   2,289    1,813 
Research and development expenses   2,847    4,016 
Fixed assets   137    159 
Loss on disposal group of assets held for sale   177    710 
Net loss carryforward   31,520    26,831 
Total deferred tax assets   37,294    33,734 
Less - valuation allowance   (37,294)   (33,734)
Deferred tax assets  $
-
   $
-