Income tax (Tables)

11 Months Ended

Dec. 31, 2019

Components of the Groups (loss)/profit before income taxes

The components of the Group's (loss)/profit before income taxes for the eleven months ended December 31, 2019 and year ended January 31, 2019 and 2018 consisted of the following:


	Eleven Months ended December 31, 2019		Year ended January 31, 2019		Year ended January 31, 2018
	(in thousands)
United Kingdom	$	(29,224)	$	7,549	$	(26,163)
United States	133		1,534		281
(Loss)/profit before income taxes	$	(29,091)	$	9,083	$	(25,882)

Significant components of the provision for income taxes

Significant components of the provision for income taxes are as follows:


	Eleven Months ended December 31, 2019		Year ended January 31, 2019		Year ended January 31, 2018
	(in thousands)
Current income tax benefit

United States	$	36	$	120	$	471
Total	36		120		471
Deferred income tax benefit
United Kingdom	(147)		(935)		—
Total	(147)		(935)		—
Total income tax	$	(111)	$	(815)	$	471

Components of deferred tax assets and liabilities

The major components of deferred tax assets and liabilities at December 31, 2019 and January 31, 2019 and 2018 are as follows:


	December 31, 2019		January 31, 2019		January 31, 2018
	(in thousands)
Deferred tax assets:
Net operating loss carryforward	$	20,095	$	16,272	$	16,931
Future exercisable shares	319		290		1,315
Provision	34		34		37
Less: Valuation allowance	(20,448)		(16,596)		(18,283)
Deferred tax assets, net of valuation allowance	—		—		—
Deferred tax liabilities:
Temporary differences relating to intangible asset	(2,057)		(2,198)		(3,372)
Deferred tax liabilities, gross	(2,057)		(2,198)		(3,372)
Deferred tax liabilities, net	$	(2,057)	$	(2,198)	$	(3,372)

Reconciliation between U.K. statutory income tax rate and the effective tax rate

The reconciliation between the U.K. statutory income tax rate for Summit and the effective income tax rates are as follows:


	Eleven Months ended December 31, 2019		Year ended January 31, 2019		Year ended January 31, 2018
U.K. corporation tax rate	19.00	%	19.00	%	19.17	%
Effect of:
Adjustment on adoption of ASC 606	—	%	(36.13)	%	(12.65)	%
Adjustment on adoption of ASC 842	—	%	0.10	%	0.03	%
Change in valuation allowance	(11.03)	%	11.93	%	(3.79)	%
Non-deductible expenses	(1.49)	%	25.93	%	(1.60)	%
Refundable R&D tax credit	3.07	%	(5.20)	%	3.55	%
R&D deduction surrendered	(9.52)	%	—	%	(5.27)	%
R&D deduction benefit	—	%	(18.62)	%	—	%
Overseas profits taxed at different rates	(0.16)	%	4.25	%	(1.26)	%
Release of temporary difference relating to intangible assets	0.51	%	(10.23)	%	—	%
Reported effective income tax rate	0.38	%	(8.97)	%	(1.82)	%