v3.26.1
Income Taxes
 6 Months Ended
Jun. 30, 2025
Income Tax Disclosure [Abstract]  
Income Taxes

Note 14 – Income Taxes

 

Cayman Islands

 

Cayman Islands entities are not subject to income taxes on profits, income, gains or appreciation, and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to the Company levied by the Government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands. The Cayman Islands is not party to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

 

Payments of dividends and capital in respect of the Company’s ordinary shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital to any holder of our ordinary shares, as the case may be, nor will gains derived from the disposal of our ordinary shares be subject to Cayman Islands income or corporation tax.

 

Malaysia

 

Malaysia Income Tax is calculated at 24% of the estimated assessable profits for the relevant year. Net operating losses can be carried forward for a limit of ten consecutive years starting from the year subsequent to the year in which the loss was incurred.

 

For Labuan Trading activity, the chargeable profits would subject to tax under Labuan Business Activity Act, 1990 (“LBATA”) of which 3% of net audited profits would be taxed.

 

Singapore

 

Singapore Income Tax is calculated at 17% of chargeable income for the relevant year. Net operating losses can be carried forward indefinitely to offset against future taxable income.

 

Taxable (loss) income before income taxes by jurisdiction are as follows:

 

  

June 30,

2025

   December 31, 2024   December 31, 2023 
  

For the Six Months Ended

   For the Years Ended 
  

June 30,

2025

   December 31, 2024   December 31, 2023 
   (Unaudited)   (Audited)   (Audited) 
Labuan  $1,022   $26,190   $25,263 
Malaysia   (1,039,138)   1,280,329    684,759 
Singapore   50,082    121,780    64,217 
Total tax (benefits) expenses  $(988,034)  $1,428,299   $774,239 

 

Reconciliations of the statutory income tax rate and the Company’s effective income tax rate are as follow:

 

  

June 30,

2025

   December 31, 2024   December 31, 2023 
  

For the Six Months Ended

   For the Years Ended 
  

June 30,

2025

   December 31, 2024   December 31, 2023 
   (Unaudited)   (Audited)   (Audited) 
Income tax expense at Labuan statutory rate  $8,411    26,247   $25,375 
Income tax expense at Malaysia statutory rate   283,787    613,388    710,438 
Income tax expense at Singapore statutory rate   69,507    110,461    91,240 
Increases (decreases) due to:               
Other adjustments   (303,211)   743,918    (177,593)
Temporary differences   (45,490)   (9,092)   13,072 
Other exemption, rebate and credit   -    (26,038)   (56,397)
(Over) Under provision in prior years(1)   (1,001,038)   (30,585)   168,104 
Tax expense (benefits), net  $(988,034)   1,428,299   $774,239 

 

(1)With the change of fiscal year end from December 31 to June 30, the reporting period of Tumpuan Megah covered 18 months from January 1, 2024 to June 30, 2025. Given Tumpuan Megah recorded a net loss for the six months ended June 30, 2025, the tax loss position reduced the overall assessable profits for the full 18-month reporting period. As a result, the provision for income tax previously recognized for the year ended December 31, 2024 was overstated by $1,001,038.

 

 

TMD Energy Limited

 

Notes to Unaudited Consolidated Financial Statements

 

For the Six Months Ended June 30, 2025 and the Years Ended December 31, 2024 and 2023