Company: QSJC
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001683168-25-001892
Chunk: 362

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 4
Chunk 362
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 72,417 
  
    Tax effect on tax losses expired 
     1,627  
     – 
  
    Income tax expense 
    $–  
    $– 

The full realization of the tax benefit associated
with the losses carried forward depends predominantly upon the Company’s ability to generate taxable income during the carry-forward
period.

In assessing the realization of deferred tax assets,
management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate
realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary
differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment. A valuation allowance is provided for deferred tax assets if it is more likely
than not that these items will either expire before the Company is able to realize their benefits or that future deductibility is uncertain.

As of December 31, 2024 and 2023, the
Company had deferred tax assets of $252,874
and $229,999
using the PRC statutory rate of 25%,
respectively. As management of the Company believes that it is more likely than not that the benefit from the loss carried forwards
will not be realized, the Company recorded a full valuation allowance of $(252,874)
and $(229,999)
for the years ended December 31, 2024 and 2023, respectively. There were no
deferred tax liabilities as of December 31, 2024 and 2023.

As of December 31, 2024, net operating tax loss
carried forward in the PRC was expected to expire as follows: 

    Schedule of net operating tax loss carried forward 

    As of December 31, 
    Tax loss carried forward 
  
    2025 
    $3,425 
  
    2026 
     1,288 
  
    2027 
     853,026 
  
    2028 
     30,349 
  
    2029 
     123,408 

    $1,011,496 

(b)  Value Added Tax (“VAT”)

In accordance with the relevant taxation laws
in the PRC, the normal VAT rate for small-scale VAT payers on domestic sales is 3%. In response to COVID-19, there are various VAT incentives