v3.25.2
INCOME TAX EXPENSE
 6 Months Ended
Jun. 30, 2025
Income Tax Disclosure [Abstract]  
INCOME TAX EXPENSE

NOTE 12 INCOME TAX EXPENSE

 

The provision for income tax expense consisted of the following:

 

       
   Six months ended June 30, 
   2024   2025 
Current income tax  $1,665,092   $2,465,661 
Deferred income tax benefit   (27,357)   (136,389)
           
Income tax expense  $1,637,735   $2,329,272 

 

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company is subject to taxes in the jurisdictions in which it operates, as follows:

 

Cayman Islands

 

Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed.

 

 

HOMESTOLIFE LTD AND SUBSIDIARIES

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

The summary of sales tax (including VAT and GST) and effective income tax rate by the governing countries are as follows:-

 

 SCHEDULE OF EFFECTIVE INCOME TAX RATE

Jurisdiction  VAT or Sales tax Rate   Income Tax Rate 
   2024   2025   2024   2025 
France   20%   20%   25%   25%
Australia   10%   10%   30%   30%
South Korea   10%   10%   10%   10%
Japan   10%   10%   32.1%-33.6%   32.1%-33.6%
United Kingdom   20%   20%   25%   25%
Singapore   9%   9%   17%   17%

 

The reconciliation of income tax rate to the effective income tax rate based on income (loss) before income tax expense for the six months ended June 30, 2024 and 2025 are as follows:

 

       
   Six months ended June 30, 
   2024   2025 
Income before income taxes  $7,003,351   $12,353,347 
Effective income tax rate   17%   17%
Income tax expense at statutory rate   1,190,569    2,100,068 
Effect of different tax rates in other countries   60,444    7,223 
Income not subject to tax deduction   -    (273,615)
Expenses not subject to tax deduction   343,293    2,150 
Net operating losses   42,269    468,263 
Other tax adjustments   1,160    25,183 
Income tax expense   1,637,735    2,329,272 

 

As of June 30, 2025, the operation in the Singapore incurred $6,651,943 (equivalent to SGD8,888,992) of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating losses carry forward have no expiration under Singapore tax regime.

 

Uncertain tax positions

 

The Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of June 30, 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the six months ended June 30, 2024 and 2025 and did not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from June 30, 2025.

 

The Company remains subject to examination by local authorities on its local tax returns for the tax periods 2024.

 

 

HOMESTOLIFE LTD AND SUBSIDIARIES

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

(Currency expressed in United States Dollars (“US$”), except for number of shares)