Company: SDAWW
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036086
Chunk: 156

Company: SunCar Technology Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 10
Chunk 156
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RC tax authorities
determine that we are a resident enterprise for PRC enterprise income tax purposes, a number of PRC tax consequences could follow. First,
we may be subject to enterprise income tax at a rate of twenty five percent (25%) on our respective worldwide taxable income, as well
as PRC enterprise income tax reporting obligations. Second, although the EIT Law provides that “dividends, bonuses and other equity
investment proceeds between qualified resident enterprises” is exempted income, and the implementing rules of the EIT Law refer
to “dividends, bonuses and other equity investment proceeds between qualified resident enterprises” as the investment proceeds
obtained by a resident enterprise from its direct investment in another resident enterprise, it is still unclear whether the dividends
we receive from Haiyan Trading and Anqi Technology would be classified as “dividends between qualified resident enterprises”
and therefore qualify for tax exemption.

If we are treated as a non-resident
enterprise under the EIT Law, any dividends that we receive from Haiyan Trading (assuming such dividends are deemed to be sourced from
within the PRC) (i) may be subject to a five percent (5%) PRC withholding tax, provided that we own more than twenty five percent (25%)
of the registered capital of Haiyan Trading and Anqi Technology incessantly within twelve (12) months immediately prior to obtaining such
dividends from Haiyan Trading and Anqi Technology, and if the Arrangement between the Mainland of China and the Hong Kong Special Administrative
Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income(the “ Arrangement”)
is applicable, or (ii) if the Arrangement does not apply (i. e. the PRC tax authorities may deem us to be a conduit not entitled to treaty
benefits), may be subject to a ten percent (10%) PRC withholding tax. Similarly, if we are treated as a non-resident enterprise, and Renovation
is treated as a resident enterprise, then any dividends that we receive from Renovation (assuming such dividends were considered sourced
within the PRC) may be subject to a ten percent (10%) PRC withholding tax. Any such taxes on dividends could materially reduce the amount
of dividends, if any, that we could pay to our shareholders.

Finally, the new “resident
enterprise” classification could result in a situation in which a ten percent (10%) PRC tax is imposed