Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 223

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 19
Chunk 223
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 EIT Law”), which was effective from January 1, 2008, domestically-owned enterprises and foreign-invested enterprises
are subject to a uniform tax rate of25%.

For the years ended September 30, 2022, 2023 and 2024, the Group incurred
income tax expenses nil, niland RMB548from its continuing operations.

A reconciliation between the effective income tax rate and the PRC
statutory income tax rate are as follows:

                                                                                                                                     For the years ended September 30,                                                          
                                                                                                                                                                  2022                  2023                  2024              
 ────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  PRC statutory tax rate                                                                                                                                                      25.0                  25.0                  25.0  
  Effect of different tax rates of group entities operating in other jurisdictions and preferential tax rates of group entities                                             ( 25.0                ( 23.0                ( 10.8  
  Effect of change in valuation allowance                                                                                                                                      0.0                 ( 2.0                 ( 7.4  
                                                                                                                                                                               0.0                   0.0                   6.8  

The principal components of the Group’s deferred income tax assets
from continuing operations as of September 30, 2023 and 2024 are as follows:

                                 As of September 30,                       
                                                2023      2024             
 ───────────────────────────────────────────────────────────────────────────
  Deferred tax assets:                                                     
  Net losses carry forwards                                         548    
  Valuation allowance                                               ( 548  
                                                                    —      

Movement of the valuation allowance is as follows:

  Balance as of September 30, 2023      —    
 ─────────────────────────────────────────────
  Addition                              548  
  Write off                             —    
  Balance as of September 30, 2024      548  

F-29

The write down of the valuation allowance is related to a reduction
of the deferred tax asset for net operating losses from to the realizable amount based on prior tax filings and deconsolidation entities.

The Group considers positive and negative evidence to determine whether
some portion or all of the deferred tax assets will more likely than not be realized. This assessment considers, among other matters,
the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward