XML 27 R16.htm IDEA: XBRL DOCUMENT
v3.10.0.1

INCOME TAXES | 3 Months Ended | 12 Months Ended
--- | --- | ---
Sep. 30, 2018 | Jun. 30, 2018
Income Tax Disclosure [Abstract] |  |
INCOME TAXES | Note 10 – income taxes The Company was incorporated in the United States of America, is subject to U.S. tax and plans to file U.S. federal income tax returns. The Company conducts all of its businesses through its subsidiaries and affiliated entities, principally in the PRC. No provision for US federal income tax was made for the three months ended September 30, 2018 and 2017 as the US entity incurred losses. The Company’s offshore subsidiary, Shuhai Skill (HK), did not earn any income that was derived in Hong Kong for the three months ended September 30, 2018 and 2017, and therefore did not incur any Hong Kong Profits tax. Under the Corporate Income Tax Law of the PRC, the corporate income tax rate is 25%. The Company has net operating losses(“NOL”) amounting to approximately $371,659 and $408,537 during three months ended September 30, 2018 and 2017 respectively. Management believes that it is more likely than not that the benefit from the NOL carryforwards will not be realized. In recognition of this risk, the Company has provided a 100% valuation as of September 30, 2018 and 2017 and no deferred tax asset benefit has been recorded. The provisions for income taxes is summarized as follows:
|  | Three Months ended September 30, 2018 |  |  | Three Months ended September 30, 2017 |
Current |  | $ | — |  |  | $ | — |
Deferred |  |  | 92,915 |  |  |  | 102,135 |
Increase in valuation allowance |  |  | (92,915 | ) |  |  | (102,135 | )
Total |  | $ | — |  |  | $ | — |
The valuation allowance increased by $92,915 and $102,135 for the three months ended March 31, 2018 and 2017, respectively. The Company’s net deferred tax asset as of September 30, 2018 and June 30, 2018 is as follows:
|  | September 30, 2018 |  |  | June 30, 2018 |
Deferred tax asset |  | $ | 1,079,010 |  |  | $ | 986,095 |
Valuation allowance |  |  | (1,079,010 | ) |  |  | (986,095 | )
Net deferred tax asset |  | $ | — |  |  | $ | — |
| Note 10 – income taxes The Company was incorporated in the United States of America, is subject to U.S. tax and plans to file U.S. federal income tax returns. The Company conducts all of its businesses through its subsidiaries and affiliated entities, principally in the PRC. No provision for US federal income tax was made for the years ended June 30, 2018 and 2017 as the US entity incurred losses. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a U.S. corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S. international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. Additionally, the Tax Act imposes a one-time transition tax on deemed repatriation of historical earnings of foreign subsidiaries, and future foreign earnings are subject to U.S. taxation. However, this one-time transition tax has no effect on the Company’s income tax expense as the Company has no undistributed foreign earnings prior to June 30, 2018, as the Company has cumulative foreign losses as of June 30, 2018. The Company’s offshore subsidiary, Shuhai Skill (HK), did not earn any income that was derived in Hong Kong for the years ended June 30, 2018 and 2017, and therefore did not incur any Hong Kong Profits tax. Under the Corporate Income Tax Law of the PRC, the corporate income tax rate is 25%. The Company has net operating losses (“NOL”) of approximately $1,604,000 and $1,193,000 during years ended June 30, 2018 and 2017 respectively. Management believes that it is more likely than not that the benefit from the NOL carryforwards will not be realized. In recognition of this risk, the Company has provided a 100% valuation allowance as of June 30, 2018 and 2017 and no deferred tax asset benefit has been recorded. The reconciliation of income tax expense (benefit) at the PRC statutory rate of 21% to the Company’s effective tax is as follows:
|  | Year Ended June 30, |
|  | 2018 |  |  | 2017 |
PRC Statutory rate |  | $ | (401,036 | ) |  | $ | (298,305 | )
Change in valuation allowance |  |  | 401,036 |  |  |  | 298,305 |
Effective tax |  | $ | — |  |  | $ | — |
The provisions for income taxes are summarized as follows:
|  | Year ended June 30, 2018 |  |  | Year ended June 30, 2017 |
Current |  | $ | — |  |  | $ | — |
Deferred |  |  | 401,036 |  |  |  | 298,305 |
Change in valuation allowance |  |  | (401,036 | ) |  |  | (298,305 | )
Total |  | $ | — |  |  | $ | — |
The valuation allowance increased by $401,036 and $298,305 for the years ended June 30, 2018 and 2017, respectively. The Company’s net deferred tax asset as of June 30, 2018 and June 30, 2017 is as follows:
|  | June 30, 2018 |  |  | June 30, 2017 |
Deferred tax asset |  | $ | 986,095 |  |  | $ | 585,059 |
Valuation allowance |  |  | (986,095 | ) |  |  | (585,059 | )
Net deferred tax asset |  | $ | — |  |  | $ | — |
For United States Income tax reporting purposes, the six months ended June 30, 2015 and the years ending June 30, 2017 and 2016 remain open and subject to audit. As of June 30, 2018, the tax years ended June 30, 2015 through June 30, 2017 for the Company’s PRC subsidiaries remain open for statutory examination by PRC tax authorities. As of June 30, 2018, the tax years ended June 30, 2015 through June 30, 2017 for the Company’s PRC subsidiaries remain open for statutory examination by PRC tax authorities.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration