Company: KARO
Filing Date: 2025-06-09
Form Type: 20-F
Source: 0001213900-25-052372
Chunk: 65

Company: Karooooo Ltd.
Filing Date: 2025-06-09
Form: 20-F
Item: Item 3
Chunk 65
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 be made only after the end of that year, and depends on the composition of our income and assets and the value of our assets
from time to time (including the value of our goodwill and other intangible assets, which may be determined in part by reference to the
market price of the ordinary shares, which has been, and could continue to be, volatile). We hold a significant amount of cash and cash
equivalents and our PFIC status for any taxable year may also depend on how, and how quickly, we use them. Because the value of our goodwill
and other intangible assets may be determined by reference to our market capitalization, we could become a PFIC for any taxable year if
the price of our ordinary shares declines significantly while we hold a substantial amount of cash, cash equivalents and financial investments.
In addition, the application of the PFIC rules is subject to certain uncertainties and the proper characterization of some of our income
and assets is not entirely clear. Accordingly, there can be no assurance that we will not be a PFIC for our current or any future taxable
year. If we were a PFIC for any taxable year during which a U. S. taxpayer owned ordinary shares, the U. S. taxpayer generally would be
subject to adverse U. S. federal income tax consequences, including increased tax liability on disposition gains and “excess distributions”
and additional reporting requirements. See “ Tax Considerations - Material U. S. Federal Income Tax Considerations - Passive
Foreign Investment Company Rules.”

Under certain attribution rules, our
non-U. S. subsidiaries are expected to be treated as controlled foreign corporations for U. S. federal income tax purposes, and, as a
result, there could be adverse U. S. federal income tax consequences to U. S. investors that own our shares (directly or indirectly)
and are treated as “ Ten Percent

Shareholders.”

Certain “ Ten Percent Shareholders”
(as defined below) in a non-U. S. corporation that is a controlled foreign corporation (a “ CFC”) for U. S. federal income tax
purposes generally are required to include in income for U. S. federal income tax purposes their pro rata share of the CFC’s “ Subpart
F income,” investment of earnings in U. S. property and “global intangible low taxed income,” even if the CFC has made
no distributions to its shareholders. A non-U. S. corporation generally will be a CFC for U.