Company: ZDAN
Filing Date: 2025-02-18
Form Type: DRS/A
Source: 0001683168-25-001085
Chunk: 252

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-02-18
Form: DRS/A
Chunk 252
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 Shares. In addition, non-resident enterprise shareholders (including the holders of Ordinary
Shares) may be subject to a 10% PRC tax on gains realized on the sale or other disposition of Ordinary Shares, if such income is treated
as sourced from within the PRC. Our non-PRC individual shareholders (including the holders of Ordinary Shares) may be subject to 20%
PRC tax on dividends or gains obtained by such non-PRC individual shareholders in the event we are determined to be a PRC resident enterprise
(which in the case of dividends may be withheld at source) unless a reduced rate is available under an applicable tax treaty. It is unclear
whether, if we are considered a PRC resident enterprise, holders of our Ordinary Shares would be able to claim the benefit of income
tax treaties or agreements entered into between China and other countries or areas.

According to the Announcement
of SAT on Several Issues Concerning the Enterprise Income Tax on Indirect Property Transfer by Non-Resident Enterprises, or Circular
7, which was promulgated by the SAT and became effective on February 3, 2015, if a non-resident enterprise transfers the equity
interests of a PRC resident enterprise indirectly by transfer of the equity interests of an offshore holding company (other than a purchase
and sale of shares issued by a PRC resident enterprise in the public securities market) without a reasonable commercial purpose, the
non-resident enterprise, being the transferor, or the transferee, or the PRC entity which directly owns such taxable assets, may report
to the relevant tax authority such indirect transfer, and PRC tax authorities have the power to reassess the nature of the transaction
and the indirect equity transfer may be treated as a direct transfer. As a result, the gain derived from such indirect transfer, may
be subject to PRC enterprise income tax, and the transferee or other person who is obligated to pay for the transfer is obligated to
withhold the applicable taxes, currently at a rate of 10% for the transfer of equity interests in a PRC resident enterprise.

| 157 |

Under the terms of Circular
7, a transfer which meets all of the following circumstances shall be directly deemed as having no reasonable commercial purposes if:

| · | over 75% of the value of the equity interests of the offshore holding                                                              
 company are directly or indirectly derived from PRC taxable properties;                                                            |
| · | at any time during the year before the indirect transfer, over