Company: GCL
Filing Date: 2025-07-31
Form Type: 20-F
Source: 0001213900-25-069672
Chunk: 146

Company: GCL Global Holdings Ltd
Filing Date: 2025-07-31
Form: 20-F
Item: Item 10
Chunk 146
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 if at least 75% of
its gross income in a taxable year, including its pro rata share of the gross income of any entity in which it is considered to own at
least 25% of the interest by value, is passive income. Alternatively, a foreign corporation will be a PFIC if at least 50% of its assets
in a taxable year, ordinarily determined based on fair market value and averaged quarterly over the year, including its pro rata share
of the assets of any entity in which it is considered to own at least 25% of the interest by value, are held for the production of, or
produce, passive income. Passive income generally includes dividends, interest, rents and royalties (other than rents or royalties derived
from the active conduct of a trade or business) and gains from the disposition of passive assets.

The determination of whether
we are a PFIC is a fact-intensive determination made on an annual basis applying principles and methodologies that in some circumstances
are unclear and subject to varying interpretation. Under the income test described above, our status as a PFIC depends on the composition
of our income which will depend on the transactions we enter into in the future and our corporate structure. The composition of our income
and assets is also affected by the spending of the cash we raise in any offering. We are not currently expected to be treated as a PFIC
for U. S. federal income tax purposes, but this conclusion is a factual determination made annually and, thus, is subject to change. Our
U. S. counsel expresses no opinion with respect to our PFIC status for any taxable year. We urge U. S. Holders to consult their own tax
advisors regarding the possible application of the PFIC rules in light of their individual circumstances.

Taxation of Distributions

Subject to the PFIC rules
discussed above, a U. S. holder generally will be required to include in gross income any distribution paid on our Ordinary Shares that
is treated as a dividend for U. S. federal income tax purposes. A distribution on such shares generally will be treated as a dividend for
U. S. federal income tax purposes to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined
under U. S. federal income tax principles). Because we may not maintain calculations of earnings and profits under U. S. federal income
tax principles, it is possible that the full amount of distributions paid by us will need to