Company: ZDAN
Filing Date: 2025-07-28
Form Type: F-1/A
Source: 0001683168-25-005450
Chunk: 161

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-07-28
Form: F-1/A
Chunk 161
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further define the term “de facto management body” as the management body that exercises substantial and overall management
and control over the business, personnel, accounts and properties of an enterprise.

While we do not currently
consider our company or any of our overseas subsidiaries to be a PRC resident enterprise, there is a risk that the PRC tax authorities
may deem our company or any of our overseas subsidiaries to be a PRC resident enterprise since a substantial majority of the members
of our management team as well as the management team of our overseas subsidiaries are located in China, in which case we or the applicable
overseas subsidiaries, as the case may be, would be subject to the PRC EIT at the rate of 25% on worldwide income. If the PRC tax authorities
determine that our Cayman Islands holding company is a “resident enterprise” for PRC EIT purposes, a number of unfavorable
PRC tax consequences could follow.

Under the Enterprise Income
Tax Law and its implementation regulations issued by the State Council, a 10% PRC withholding tax is applicable to dividends paid
to investors that are nonresident enterprises, which do not have an establishment or place of business in the PRC or which have such
establishment or place of business but the dividends are not effectively connected with such establishment or place of business, to the
extent such dividends are derived from sources within the PRC.

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In addition, any gain realized
on the transfer of shares by such investors is also subject to PRC tax at a rate of 10%, if such gain is regarded as income derived from
sources within the PRC. If we are deemed to be a PRC resident enterprise, dividends paid on our Ordinary Shares, and any gain realized
from the transfer of our Ordinary Shares, may be treated as income derived from sources within the PRC and may as a result be subject
to PRC taxation.

Furthermore, if we are deemed
to be a PRC resident enterprise, dividends paid to individual investors who are non-PRC residents and any gain realized on the transfer
of Ordinary Shares by such investors may be subject to PRC tax at a current rate of 20% (which in the case of dividends may be withheld
at source). Any PRC tax liability may be reduced under applicable tax treaties or tax arrangements between China and other jurisdictions.
If we or any of our subsidiaries established outside China are considered to be a PRC resident enterprise, it is unclear whether holders