Currenc Group Inc. Income Taxes Disclosure

17 Income tax

 

The Company’s loss before income tax consists of:

 Schedule of Income before income tax

		2024				2023
		Years ended December 31,
		2024				2023
		US$				US$
Malaysia			1,126,832				2,042,746
Indonesia			(723,350	)			(786,490	)
Hong Kong			(38,651,082	)			(15,141,598	)
Others			(859	)			(8,963	)
Loss before income tax			(38,248,459	)			(13,894,305	)

 

The Company is incorporated in Cayman Islands and is not subject to corporate income tax under its relevant regulations.

 

For the Company’s subsidiaries incorporated in Hong Kong, they are subject to a corporate tax rate of 16.5% on the assessable profits arising from Hong Kong.

 

For the Company’s subsidiaries incorporated in Malaysia, they are subject to corporate tax rate on 24% on the assessable profits arising from Malaysia.

 

For the Company’s subsidiaries incorporated in Indonesia, they are subject to a corporate tax rate of 22% on the assessable profits arising from Indonesia.

 

For the Company’s subsidiary incorporated in Singapore, it is subject to a corporate tax rate of 17% on the assessable profits arising from Singapore. No provision for Singapore profits tax has been made in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2024 and 2023.

 

For the Company’s subsidiary incorporated in United Kingdom, it is subject to a corporate tax rate of 19% on the assessable profits arising from United Kingdom. No provision for United Kingdom profits tax has been made in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2024 and 2023.

 

 

CURRENC GROUP INC. AND SUBSIDIARIES

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

17	Income tax (Continued)

 

Income tax expense consists of:

 Schedule of Income Tax Expenses

		2024				2023
		Years ended December 31,
		2024				2023
		US$				US$
Income tax expense			534,661				797,147
Deferred income tax benefit			43,642				(273,666	)
Total income tax expense			578,303				523,481

 

A reconciliation of the income tax expense to the amount computed by applying the current statutory tax rate to the income before income tax in the consolidated statements of operations and comprehensive loss is as follows:

 Schedule of Effective Income Tax Rate Reconciliation

		2024				2023
		Years ended December 31,
		2024				2023
		US$				US$
Income before income tax			(28,748,459	)			(13,894,305	)
Tax calculated at Hong Kong profits tax rate			(4,743,494	)			(2,292,560	)
Effect of different tax rates applicable to different jurisdictions			6,683,940				1,637,665
Income not subject to tax			(8,328,873	)			(48,307	)
Non-deductible expenses			5,705,763				132,796
Change in valuation allowance			1,041,756				846,827
Underprovision of current tax in the previous financial year			31,902				125,217
Tax effect on deductible temporary differences			7,946				7,918
Others			179,363				113,925
Income tax			578,303				523,481

 

The Company’s deferred tax assets and liabilities as of December 31, 2024 and 2023 are attributable to the following:

 Schedule of Deferred Tax Assets and Liabilities

		2024				2023
		December 31,
		2024				2023
		US$				US$
Deferred tax assets
Tax losses carried forward			8,193,135				8,266,115
Equipment			(82,885	)			(65,050	)
Accrued expenses			419,001				296,576
Others			82,657				54,560
Total deferred tax assets			8,611,908				8,552,201
Valuation allowance			(8,269,086	)			(7,887,313	)
Total deferred tax assets			342,822				664,888
Deferred tax liabilities
Fixed assets							—
Intangible assets			(876,875	)			(1,184,987	)
Others			(37	)			(61,773	)
Total deferred tax liabilities			(876,912	)			(1,246,760	)
Net deferred tax liabilities			(534,090	)			(581,872	)

 

 

CURRENC GROUP INC. AND SUBSIDIARIES

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

17	Income tax (Continued)

 

As of December 31, 2024 and 2023, management has recorded a valuation allowance on certain deferred tax assets where management believes that after considering all of the available evidence, it is more likely than not that some portion or all will not be realized in the foreseeable future. The ultimate realization of deferred tax assets depends on the generation of future taxable income in which those temporary differences and carry forwards become deductible.

 

As of December 31, 2024 and 2023, the accumulated tax losses of subsidiaries can be carried forward to offset against future taxable profits. The tax loss for the subsidiary incorporated in Hong Kong is US$66,424 and US$47,778,609 as of December 31, 2024 and 2023, respectively, which can be carried forward indefinitely.

 

As of December 31, 2024 and 2023, the accumulated tax losses of subsidiaries can be carried forward to offset against future taxable profits. The tax loss for the subsidiary incorporated in Singapore is US$73,524 and US$94,611 as of December 31, 2024 and 2023, respectively, which can be carried forward indefinitely.

 

The tax loss in the subsidiary incorporated in United Kingdom is US$Nil and US$517,015 as of December 31, 2024 and 2023, respectively, which can be carried forward indefinitely.

 

The tax loss in the subsidiaries incorporated in Indonesia is US$2,099,326 and US$2,349,921 as of December 31, 2024 and 2023, respectively, which will expire, if unused, in the year ending December 31, 2024.

 

The tax loss in the subsidiaries incorporated in Malaysia is US$Nil and US$8,439 as of December 31, 2024 and 2023, respectively, which will expire, if unused, in the year ending December 31, 2031.