Company: FLYE
Filing Date: 2025-02-19
Form Type: 10-Q
Source: 0001213900-25-015334
Chunk: 132

Company: Fly-E Group, Inc.
Filing Date: 2025-02-19
Form: 10-Q
Item: Part I, Item 8
Chunk 132
---
 to equity, in which case the deferred tax is also dealt
with in equity. DTAs are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion
or all the DTAs will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

An uncertain tax position is recognized as a benefit
only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination
being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized
on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest
incurred related to underpayment of income tax are classified as income tax expense in the period incurred. The tax returns filed in 2018
to 2023 are subject to examination by any appropriate tax authorities. For the three months ended December 31, 2024 and 2023, the Company
accrued nil and nil income tax related penalty included in current income taxes expenses, respectively. For the nine months ended December
31, 2024 and 2023, the Company accrued $63,812 and $55,604 income tax related penalty included in current income taxes expenses, respectively.

(s) Leases

The Company accounts for leases in accordance
with ASC 842. The Company leases premises for offices, warehouses, and retail stores under non-cancellable operating leases, and
the Company leases its products to customers under non-cancellable operating leases.

Lessor

The
Company’s lease arrangements include products rentals to customers. The lease term is from one hour to one month. Due to the short-term
  nature of these arrangements, the Company classifies these
leases as operating leases. The Company does not separate lease and non-lease components, such as insurance or roadside assistance provided
to the lessee, in its lessor lease arrangements. Lease payments are primarily fixed and are recognized as revenue in the period over which
the lease arrangement occurs. Taxes or other fees assessed by governmental authorities that are both imposed on and concurrent with each
lease revenue-producing transaction and collected by the Company from the lessee are excluded from the consideration in its lease arrangements.
The Company mitigates residual value risk of its leased assets by performing regular maintenance and repairs, as necessary, and through
periodic reviews of