Entera Bio Ltd. Income Taxes Disclosure
| a) |
Corporate tax rate
|
| i. |
Ordinary taxable income in Israel is subject to a corporate tax rate of 23%.
|
| ii. |
The Company’s subsidiary Entera Bio, Inc. is taxed separately under the U.S. tax laws at a tax rate of 29% (federal and state tax)
|
| b) |
Losses for tax purposes carried forward to future years
|
| c) |
Tax assessments
|
| d) |
Loss before income taxes is composed of the following:
|
|
Year ended December 31
|
||||||||
|
2025
|
2024
|
|||||||
|
Entera Bio Ltd.(domestic)
|
11,436
|
9,479
|
||||||
|
Entera Bio Inc.(foreign)
|
3
|
48
|
||||||
|
Total loss before taxes
|
11,439
|
9,527
|
||||||
| e) |
Income tax expense:
|
|
Year ended December 31
|
||||||||
|
Current:
|
2025
|
2024
|
||||||
|
Subsidiary: (foreign)
|
-
|
-
|
||||||
|
Total current income tax
|
-
|
-
|
||||||
|
Deferred income taxes – subsidiary (foreign)
|
-
|
14
|
||||||
|
Total deferred income taxes
|
-
|
14
|
||||||
|
Total income tax expense
|
-
|
14
|
||||||
| f) |
Deferred income taxes:
|
|
December 31,
|
||||||||
|
Deferred tax assets:
|
2025
|
2024
|
||||||
|
Net operating loss carry forward
|
21,114
|
19,208
|
||||||
|
Research and development
|
1,027
|
854
|
||||||
|
Share-based compensation
|
687
|
639
|
||||||
|
Other
|
133
|
172
|
||||||
|
Net deferred tax assets before valuation allowance
|
22,961
|
20,873
|
||||||
|
Valuation allowance
|
(22,961
|
)
|
(20,873
|
)
|
||||
|
Net deferred tax assets
|
-
|
-
|
||||||
| g) |
Roll-forward of valuation allowance:
|
|
Balance at January 1, 2024
|
19,471
|
|||
|
Additions
|
1,402
|
|||
|
Balance at January 1, 2025
|
20,873
|
|||
|
Additions
|
2,088
|
|||
|
Balance at December 31, 2025
|
22,961
|
| h) |
Reconciliation of theoretical tax expenses to actual expenses:
|
|
Year Ended December 31, 2025
|
Year Ended December 31, 2024
|
|||||||||||||||
| $ |
%
|
$ |
%
|
|||||||||||||
|
Statutory corporate tax rate
|
(2,630
|
)
|
(23
|
)
|
(2,202
|
)
|
(23
|
)
|
||||||||
|
Foreign tax effects
|
||||||||||||||||
|
United States
|
(1
|
)
|
*
|
(3
|
)
|
*
|
||||||||||
|
Non-taxable or non-deductible items:
|
||||||||||||||||
|
Share-based compensation
|
535
|
(23
|
)
|
815
|
(23
|
)
|
||||||||||
|
Other
|
8
|
(23
|
)
|
2
|
(23
|
)
|
||||||||||
|
Change in valuation allowance
|
2,088
|
(23
|
)
|
1,402
|
(23
|
)
|
||||||||||
|
Effective tax rate
|
-
|
-
|
14
|
*
|
||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 27, 2026 | Showing above |
| 2024 | Mar 28, 2025 | |
| 2023 | Mar 8, 2024 | |
| 2022 | Mar 31, 2023 | |
| 2021 | Mar 8, 2022 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.