| INCOME TAX |
NOTE 5 — INCOME TAX
Income tax consists of the
following for the years ended March 31, 2025, March 31,2024 and March 31,2023:
| | |
For the
year ended
March 31,
2025 | | |
For the
year ended
March 31,
2024 | | |
For
the
year ended
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Tax expenses | |
| | |
| | |
| |
| - For current year | |
$ | 108,382 | | |
$ | 119,238 | | |
$ | 387,407 | |
| - Short provision of earlier year | |
| 12,265 | | |
| — | | |
| — | |
| Deferred tax (benefit) / expense | |
| 11,507 | | |
| 28,241 | | |
| 135,640 | |
| Income tax expense | |
$ | 132,154 | | |
$ | 147,479 | | |
$ | 523,047 | |
Consolidated statement of comprehensive income
| | |
For the
year ended
March 31,
2025 | | |
For the
year ended
March 31,
2024 | | |
For the
year ended
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Deferred tax related to item charged directly to equity: | |
| | |
| | |
| |
| Net loss/(gain) on translations of foreign subsidiaries | |
$ | 478 | | |
$ | 27,701 | | |
$ | 72,663 | |
| Total | |
$ | 478 | | |
$ | 27,701 | | |
$ | 72,663 | |
Deferred tax related to the
translations of foreign operations consists of Lytus India and Sri Sai from INR to USD have been calculated at the rate of the jurisdiction
in which a subsidiary is situated (i.e., in India) (at the rate of 25.17% for the years ended March 31, 2025, 2024 and 2023, respectively).
Accounting for Income Taxes
British Virgin Islands
Under the current laws of
BVI, the Company is not subject to tax on income or capital gains. In addition, payments of dividends by the Company to its shareholders
are not subject to withholding tax in the BVI. India (subsidiary in India)
Income tax expense represents
the sum of the current tax and deferred tax.
The charge for current tax
is based on the result for the period adjusted for items which are non-assessable or disallowed. It is calculated using tax rates that
have been enacted or substantively enacted by the reporting date.
Current and deferred tax
is recognized in the income statement unless the item to which the tax relates was recognized outside the income statement being other
comprehensive income or equity. The tax associated with such an item is also recognized in other comprehensive income or equity respectively.
| | |
As of
March 31,
2025 | | |
As of
March 31,
2024 | | |
As of
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Accounting profit before tax | |
$ | 961,566 | | |
$ | 800,653 | | |
$ | (1,112,790 | ) |
| Less: Net profit/(loss) of the Lytus BVI and non-taxable loss/(profit) of GHSI | |
| (324,502 | ) | |
| 114,296 | | |
| (3,134,953 | ) |
| Net Accounting profit | |
| 1,286,069 | | |
| 686,357 | | |
| 2,022,163 | |
| At Indian statutory income tax rate of 25.17% | |
| 323,678 | | |
| 224,878 | | |
| 508,979 | |
| Accelerated tax depreciation | |
| (98,194 | ) | |
| (131,667 | ) | |
| (139,328 | ) |
| Others mainly timing differences | |
| (100,026 | ) | |
| 19,728 | | |
| 27,474 | |
| Exchange differences | |
| (4,811 | ) | |
| 6,299 | | |
| (9,718 | ) |
| Current income tax expense reported on consolidated statements of profit or loss and other comprehensive income | |
$ | 120,647 | | |
| 119,238 | | |
$ | 387,407 | |
Reflected in the financial statement of financial
position as follows:
| | |
As of
March 31,
2025 | | |
As of
March 31,
2024 | | |
As of
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Opening balance | |
$ | 160,266 | | |
| 399,174 | | |
| 3,305,308 | |
| Acquired in business combination | |
| — | | |
| — | | |
| 121,319 | |
| Income tax accrual - | |
| | | |
| | | |
| | |
| - of current year | |
| 108,382 | | |
| 119,238 | | |
| 387,407 | |
| - Short provision of previous year | |
$ | 12,265 | | |
| — | | |
| — | |
| Adjustment on account of modifications | |
| | | |
| | | |
| (3,399,850 | ) |
| Exchange rate difference | |
| (3,331 | ) | |
| (3,565 | ) | |
| (15,010 | ) |
| Taxes paid/adjustments | |
| (183,885 | ) | |
| (354,581 | ) | |
| — | |
| Closing balance of current income taxes payables | |
$ | 93,698 | | |
$ | 160,266 | | |
$ | 399,174 | |
Deferred tax
Deferred tax relates to the
following temporary differences:
| | |
As of
March 31,
2025 | | |
As of
March 31,
2024 | | |
As of
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Deferred tax assets | |
| | |
| | |
| |
| Temporary timing differences | |
$ | 68,858 | | |
$ | 70,463 | | |
$ | (22,878 | ) |
| Exchange rate difference | |
| 10,596 | | |
| — | | |
| | |
| Foreign currency translations of foreign subsidiary | |
| — | | |
| — | | |
| 126,624 | |
| Total deferred tax assets (A) | |
$ | 79,454 | | |
$ | 70,463 | | |
$ | 103,746 | |
| Deferred tax liabilities | |
| | | |
| | | |
| | |
| Accelerated depreciation on tangible and intangible assets | |
$ | 5,06,651 | | |
$ | 498,112 | | |
$ | 1,625,271 | |
| Acquired in business combination | |
| — | | |
| — | | |
| 295,177 | |
| Temporary differences | |
| — | | |
| — | | |
| 9,929 | |
| Reversed in deconsolidation/Modification of contracts | |
| | | |
| | | |
| (1,533,644 | ) |
| Exchange rate difference | |
| — | | |
| — | | |
| 8,963 | |
| Foreign currency translations of foreign subsidiary | |
| 478 | | |
| (3,381 | ) | |
| 72,663 | |
| Total deferred tax liabilities (B) | |
$ | 507,129 | | |
$ | 494,731 | | |
$ | 478,359 | |
| | |
| — | | |
| — | | |
| — | |
| Total Net Deferred Tax Liabilities (B-A) | |
$ | 427,675 | | |
$ | 424,268 | | |
$ | (374,613 | ) |
Reconciliation of deferred tax (liabilities)/asset
net:
| | |
As of
March 31,
2025 | | |
As of
March 31,
2024 | | |
As of
March 31,
2023 | |
| | |
(US$) | | |
(US$) | | |
(US$) | |
| Opening balance | |
$ | (424,268 | ) | |
$ | (374,613 | ) | |
$ | (1,407,020 | ) |
| Tax expense during the period recognized in profit & loss | |
| (11,507 | ) | |
| (131,677 | ) | |
| (135,640 | ) |
| Exchange rate difference | |
| 10,596 | | |
| (6,134 | ) | |
| (37,613 | ) |
| Tax expenses during the period recognized in other comprehensive income | |
| (2,496 | ) | |
| 39,771 | | |
| (72,663 | ) |
| Temporary timing differences | |
| — | | |
| 195,100 | | |
| 3,084,267 | |
| Reversed on deconsolidation of a subsidiary | |
| — | | |
| (146,715 | ) | |
| (1,510,767 | ) |
| Acquired in business combination | |
| — | | |
| — | | |
| (295,177 | ) |
| Total deferred tax (liabilities)/assets net | |
$ | (427,675 | ) | |
$ | (424,268 | ) | |
$ | (374,613 | ) |
|