The components of (loss)/gain before income taxes consist of the following: (In USD)

The following is a reconciliation of the statutory federal income tax rate to our effective tax rate:

The following table presents a reconciliation of the provision for income taxes to the amount computed by applying the 21% U.S. federal statutory income tax rate to the income before taxes prior to the adoption of ASU 2023-09 for the periods presented (in percentages):

Zoomcar Holdings, Inc. and Zoomcar, Inc. have combined unused tax losses amounting to $59,823,957 and $51,733,104 as at March 31, 2026 and March 31, 2025 respectively. $59,008,831 can be carried forward indefinitely, whereas $64,347 can be carried forward up to 2033; $294,720 up to 2034; $220,520 up to 2035; $115,253 up to 2036 and $120,286 up to 2037.

The Company’s operations are primarily based out of Indian jurisdiction. There are unused tax losses amounting to $94,903,655 and $113,344,007 as at March 31, 2026 and March 31, 2025 respectively in the Indian subsidiary. The tax benefit for these losses, if not utilized, will expire on various dates starting from financial year 2026 to 2033. Additionally, net operating losses amounting to $35,630,707 (March 31, 2025: 38,896,865) is available for set-off against future income without any expiration date. Under the Indian jurisdiction, a period of 3 financial years remain open to assessment by tax authorities or a period of 10 financial years if the assessing officer has evidence that undeclared income exceeds certain limit.

The Company has created valuation allowance on the deferred tax asset resulting from such losses due to Company’s history of past losses and lack of conclusive evidence to support the view that sufficient taxable profit will be generated in the future by the Company to offset such losses.

Zoomcar Holdings, Inc. files tax returns in the U.S. federal, various state, and foreign jurisdictions. In the normal course of business, the Company is subject to examination by tax authorities. Our major tax jurisdiction is in India. The Indian tax authority is currently examining our 2016 through 2023 tax returns. There are other ongoing audits in various other jurisdictions that are not material to the Consolidated Financial Statements.

The Company has filed appeals against the above orders before the higher authority.

The Company has not recognized any uncertain tax position for the year ended March 31, 2026 and March 31, 2025, respectively. The Company believes these orders are unlikely to be sustained at the higher appellate authorities.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company’s deferred income tax assets and liabilities as of March 31, 2026 and 2025 consisted of the following:

In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended March 31, 2026, the change in the valuation allowance was $20,969,054.

The Company has computed income tax expense/(benefit) for the year ended March 31, 2026 and March 31, 2025 by using a forecasted annual effective tax rate and adjust for any discrete items arising during the period. The Company has recorded $NIL tax expense for the given years. Our effective tax rate was 0.00% for the year ended March 31, 2026 and March 31, 2025, respectively. The Company has computed a valuation allowance on deferred tax assets for the year ended March 31, 2026 and hence no deferred tax asset is recognized as at March 31, 2026. The effective tax rate differs from the statutory tax rate of 21% for the year ended March 31, 2026 and 2025, due to changes in valuation allowance on the deferred tax assets.

The Company has received various orders from Indian tax authorities, for details Refer Note 30.