Company: NCL
Filing Date: 2025-07-02
Form Type: 10-K/A
Source: 0001575872-25-000444
Chunk: 36

Company: Northann Corp.
Filing Date: 2025-07-02
Form: 10-K/A
Chunk 36
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 in the case of the first entity being a natural person carrying on a sole proprietorship business-the other entity is the same person carrying on another sole proprietorship business. Since Benchwick is wholly owned and under the control of Northann, it is a connected entity. Under the Ordinance, it is an entity’s election to nominate the entity that will be subject to the two-tier profits tax rates on its profits tax return. The election is irrevocable. The Company elected Benchwick to be subject to the two-tier profits tax rates.

The provision for current income and deferred taxes of Benchwick has been calculated by applying the new tax rate of 8.25%.

PRC

In accordance with the relevant tax laws and regulations of the PRC, a company registered in the PRC is subject to income taxes within the PRC at the applicable tax rate on taxable income. All the PRC subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 25% for the year ended December 31, 2024 and 2023 . According to PRC tax regulations, the PRC net operating loss can generally carry forward for no longer than five years starting from the year subsequent to the year in which the loss was incurred. Carry back of losses is not permitted. If not utilized, the PRC net operating loss will expire in 2026.

The income tax expense was $ 1,733 and $ 14,361 for the years ended December 31, 202 4 and 202 3 , respectively, related primarily to the Company’s subsidiaries located outside of the U.S. The income before provision for income taxes for the years ended December 31, 202 4 and 202 3 was as follows:

The income tax provision consists of the following components:

|                          |     | For the year ended 
 December 31,       
 2024               |       |   |     | For the year ended 
 December 31,       
 2023               |        |
|:-------------------------|:----|:-------------------|------:|:--|:----|:-------------------|-------:|
| Current:                 |     |                    |       |   |     |                    |        |
| Federal                  |     | $                  |     - |   |     | $                  |      - |
| State                    |     |                    |  (108 | ) |     |                    | 12,851 |
| Foreign                  |     |                    |