UK's R&D Tax Relief Scheme

12 Months Ended

Dec. 31, 2018

Other Income and Expenses [Abstract]

UK's R&D Tax Relief Scheme

UK’s R&D Tax Relief Scheme

The Company carries out extensive research and development activities that benefit from UK’s small and medium-sized enterprises (SME) R&D tax relief scheme. Under this tax relief scheme, a SME has an option to receive an enhanced UK tax deduction on its eligible R&D activities or, when an SME entity is in a net operating loss position, can elect to surrender net operating losses that arise from its eligible R&D activities in exchange for a cash payment from the UK tax authorities. As the tax incentives may be received without regard to an entity’s actual tax liability, they are not subject to accounting for income taxes. Amounts recognized by the Company for cash payment claims under the SME R&D tax relief scheme are recorded as a component of other income after an election for tax relief has been made for a discrete tax year by submitting a claim and collectability is deemed probable and reasonably assured. 

In 2018, other income included $10.1 million related to elections the Company made to surrender net operating losses that arose from eligible R&D activities in exchange for cash under the SME R&D tax relief scheme. The balance consisted of a $3.0 million claim submitted in December 2017 for the Company's 2015 tax year, which was received in July 2018, and a $7.1 million claim submitted in December 2018 for the Company’s 2016 tax year, which was received in February 2019. As of December 31, 2018, other current assets included a $7.1 million receivable related to the submitted claim for the Company’s 2016 tax year. As of December 31, 2017, the Company did not record a receivable related to the submitted claim for its 2015 tax year as collectability was not probable or reasonably assured. The Company has not submitted claims or made elections to receive enhanced UK tax deductions on its eligible R&D activities for its 2017 or 2018 tax years.