v3.26.1
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Taxes [Abstract]  
INCOME TAXES

19. INCOME TAXES

 

YD Bio and YD Biopharma are incorporated in the Cayman Islands, which is exempt from income tax. YD Biopharma’s 100% wholly owned subsidiary, Yong Ding, is incorporated in the ROC and is subject to the ROC Income Tax Law. The applicable tax rate is 20% for the year ended December 31, 2025, 2024 and 2023. YD USA is a company incorporated in the state of Delaware and operating in Washington, USA, subject to federal income tax at a rate of 21%, with no state income tax.

 

Significant components of the provision for income taxes (benefits) are as follows:

 

   Years ended December 31, 
   2025   2024   2023 
Current tax  $
—
   $
—
   $
—
 
Deferred tax – tax loss   
—
    25,175    5,049 
Deferred tax – book-tax difference   (1,531)   (95)   (959)
Income taxes (benefits) expenses  $(1,531)  $25,080   $4,090 

 

Reconciliation of the differences between the Income Tax rate applicable to profits and the income tax (benefits) expenses of the Company:

 

   Years ended December 31, 
   2025   2024   2023 
Income(loss) before taxation  $(8,312,847)  $(1,386,479)  $17,650 
                
Notional tax on loss before tax               
Computed expected tax (benefits) expense   (433,837)   (277,296)   3,530 
Non-taxable or non-deductible expenses   (151,637)   129,635    560 
Change in valuation allowances   583,943    172,741    
—
 
Total  $(1,531)  $25,080   $4,090 

 

The following table reconciles statutory rate of jurisdictions in which we do business to Yong Ding’s effective tax rate:

 

   Years ended December 31, 
   2025   2024   2023 
Statutory income tax rate   20.00%   20.00%   20.00%
Non-taxable or non-deductible expenses   7.53%   0.63%   3.17%
Change in valuation allowances   -27.45%   -24.14%   
—
%
Effective tax rate   0.08%   -3.50%   23.17%

The following table reconciles statutory rate of jurisdictions in which we do business to YD USA’s effective tax rate:

 

   Years ended December 31, 
   2025   2024   2023 
Statutory income tax rate   21.00%   
—
    
—
 
Non-taxable or non-deductible expenses   0.00%   
—
    
—
 
Change in valuation allowances   -21.00%   
—
    
—
 
Effective tax rate   0.00%   
—
    
—
 

 

Deferred tax assets (liabilities) are as follows:

 

   December 31,
2025		   December 31,
2024		 
Deferred tax assets        
Tax losses carry forwards  $551,303   $167,454 
Expected credit losses   1,543    421 
Others   
—
    991 
Valuation allowance   (552,846)   (168,866)
   $
—
   $
—
 
           
Deferred tax liabilities          
Property, plant and equipment  $
—
   $(1,463)
Total deferred tax assets  $
—
   $(1,463)

 

As of December 31, 2025, Yong Ding had net operating loss carryforwards of $2,756,513. The carry forward loss of $739,838 and $2,016,675 will be expired by 2034 and 2035, respectively, if not utilized.

 

As of December 31, 2025, YD USA had federal net operating loss carryforwards of $148,088, which may be carried forward indefinitely to offset future taxable income, but are subject to the 80% taxable income limitation upon utilization.