Company: LI
Filing Date: 2025-04-10
Form Type: 20-F
Source: 0001410578-25-000678
Chunk: 229

Company: Li Auto Inc.
Filing Date: 2025-04-10
Form: 20-F
Item: Item 10
Chunk 229
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 significantly increase relative to our revenues from activities that produce non-passive income, or where we determine not to deploy significant amounts of cash for active purposes, our risk of being or becoming classified as a PFIC may substantially increase.

If we are classified as a PFIC for any taxable year during which a U. S. Holder holds our ADSs or Class A ordinary shares, the PFIC rules discussed below under “ - Passive Foreign Investment Company Rules” generally will apply to such U. S. Holder for such taxable year, and unless the U. S. Holder makes certain elections, will apply in future years even if we cease to be a PFIC.

The discussion below under “ - Dividends” and “ - Sale or Other Disposition” is written on the basis that we will not be or become classified as a PFIC for U. S. federal income tax purposes. The U. S. federal income tax rules that apply generally if we are treated as a PFIC for any taxable year are discussed below under “ - Passive Foreign Investment Company Rules.”

Table of Contents

Dividends

Any cash distributions (including the amount of any PRC tax withheld) paid on our ADSs or Class A ordinary shares out of our current or accumulated earnings and profits, as determined under U. S. federal income tax principles, will generally be includible in the gross income of a U. S. Holder as dividend income on the day actually or constructively received by the U. S. Holder, in the case of Class A ordinary shares, or by the depositary, in the case of ADSs. Because we do not intend to determine our earnings and profits on the basis of U. S. federal income tax principles, any distribution we pay will generally be treated as a “dividend” for U. S. federal income tax purposes. Dividends received on our ADSs or Class A ordinary shares will not be eligible for the dividends received deduction generally allowed to corporations. A non-corporate U. S. Holder will be subject to tax at the lower capital gain tax rate applicable to “qualified dividend income,” provided that certain conditions are satisfied, including that (1) our ADSs or Class A ordinary shares on which the dividends are paid are readily tradeable on an established securities market in the United States, or, in the event that we are deemed to be a PRC resident enterprise under the PRC tax law, we are eligible for the benefits of the United States-PRC income tax treaty, (2)