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Taxation
 6 Months Ended
Sep. 30, 2024
Income Tax Disclosure [Abstract]  
Taxation

18. Taxation

 

The Company is registered in the Cayman Islands. The Group generated substantially all of its income from its PRC operations for the six months ended September 30, 2024 and 2023.

 

Cayman Islands

 

Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain, and no withholding tax is imposed to any dividends and payment made to shareholders.

 

Hong Kong

 

The Company’s subsidiary Easy Skills Technology Limited is located in Hong Kong and is subject to an income tax rate of 16.5% for assessable profit earned in Hong Kong before April 2018, and an income tax rate of 8.25% for assessable profit up to HKD 2,000,000 from April 2018 onwards. The Group had no assessable profit subject to Hong Kong profit tax for the six months ended September 30, 2024 and 2023.

 

PRC

 

Income Tax

 

The Company’s subsidiaries and VIE in the PRC are subject to the statutory rate of 25%, in accordance with the Enterprise Income Tax law (the “EIT Law”), which was effective since January 1, 2008.

 

Dividends, interests, rent or royalties payable by the Group’s PRC subsidiaries, to non-PRC resident enterprises, and proceeds from any such non-resident enterprise investor’s disposition of assets (after deducting the net value of such assets) shall be subject to 10% withholding tax, unless the respective non-PRC resident enterprise’s jurisdiction of incorporation has a tax treaty or arrangements with China that provides for a reduced withholding tax rate or an exemption from withholding tax.

 

 

The current and deferred portions of income tax expense included in the consolidated statements of income were as follows:

 

   2024   2023 
   For the six months ended September 30, 
   2024   2023 
Current  $—   $— 
Deferred   —    (3,988)
Income tax expense  $—   $(3,988)

 

The following table sets forth reconciliation between the statutory EIT rate of 25% and the effective tax for the six months ended September 30, 2024 and 2023, respectively:

 

   2024   2023 
   For the six months ended September 30, 
   2024   2023 
Income before income taxes  $(2,936,434)  $(370,961)
Tax rate   25%   25%
Provision for income taxes at statutory tax rate  $(734,108)  $(92,740)
Effect of tax exempt entity   212,528    164,743 
Effect of non-tax deductible expenses   409    23 
Effect of tax loss not recognized   355,721    158,607 
Effect of investment income not recognized   (291,747)   (232,990)
Effect of impairment not recognized   457,197    (1,631)
Income tax expense  $—   $(3,988)
           
Deferred tax assets/liability          
Deferred tax assets  $5,004,640   $3,490,495 
Valuation allowance   (5,004,640)   (3,490,495)
Deferred tax assets, net   —    — 
Deferred tax liability   —    (23,074)
Total   —    (23,074)

 

The temporary difference in the financial statements for the six months ended September 30, 2024 was mainly derived from the net loss of Wuxi Wangdao and Jisen. The temporary difference between the tax base and the reported amount of assets and liabilities in the financial statements for the six months ended September 30, 2023 was derived from the intangible assets recognized from the acquisition of Jisen Information.

 

Value Added Tax (“VAT”)

 

The Group’s membership revenues for providing non-academic education services are subject to a simple tax method to calculate VAT at 3%. The Group’s technical service revenue is subject to a VAT rate of 6%.

 

Taxes payable consisted of the following:

 

   September 30, 2024   March 31, 2024 
   As of 
   September 30, 2024   March 31, 2024 
Income tax payable  $188,613   $189,588 
VAT payable   5,456    4,971 
Total  $194,069   $194,559