Company: FLYE
Filing Date: 2025-07-15
Form Type: 10-K
Source: 0001213900-25-064293
Chunk: 688

Company: Fly-E Group, Inc.
Filing Date: 2025-07-15
Form: 10-K
Item: Item 2
Chunk 688
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 internal use software acquired and internally developed in accordance with ASC 350-40 “Software—internal
use software”. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development,
and costs that are associated with maintenance of the existing software for internal use. Certain costs associated with developing internal-use
software are capitalized when such costs are incurred within the application development stage of software development. As a result, the
Company expensed the development costs of the Fly E-Bike app as they incurred. For the years ended March 31, 2025 and 2024, development
costs amounted to $549,368 and $292,724, respectively, which were recorded under general and administrative expenses.

(r) Income Taxes

Current income taxes are provided based on net
income/(loss) for financial reporting purposes and adjusted for income and expense items which are not assessable or deductible for income
tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

Deferred taxes are accounted for using the asset
and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities
in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle,
deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets (the “DTAs”) are recognized
to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized.

Deferred tax is calculated using tax rates that
are expected to apply to the period when the asset is realized, or the liability is settled. Deferred tax is charged or credited in the
income statement, except when it is related to items credited or charged directly 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