v3.26.1
Taxes
 6 Months Ended
Apr. 30, 2026
Taxes [Abstract]  
TAXES

Note 10 — TAXES

 

(a) Corporate Income Taxes (“CIT”)

 

Cayman

 

Caravelle is incorporated in the Cayman Islands as an offshore holding company and is not subject to tax on income or capital gain under the laws of the Cayman Islands.

 

BVI

 

SGEX is incorporated in the British Virgin Islands (“BVI”) as an offshore holding company and is not subject to tax on income or capital gain under the laws of BVI.

 

Samoa

 

Topsheen Shipping Group Corporation was incorporated in Samoa. There is no income tax for income sourced or earned outside Samoa. Accordingly, the Company’s consolidated financial statements do not present any income tax provisions related to Samoa tax as all income was earned outside of Samoa.  If the Company had any income sourced in Samoa, it would be taxed at 27%.

 

Singapore

 

Under Singapore tax laws, subsidiaries in Singapore are subject to statutory income tax rate at 17.0% if revenue is generated in Singapore and there are no withholding taxes in Singapore on remittance of dividends.

 

Topsheen Companies participates under the Maritime Sector Incentive-Approved International Shipping Enterprise (MSI-AIS) award in Singapore. All qualified shipping income derived from the shipping activity of Topsheen Companies is exempt from taxation for the duration of MSI-AIS approval. The MSI-AIS approval was received in November 2015 for a period of ten years and extended for another ten years in November 2025. The impact of the tax exemption noted above decreased taxes by $nil for the six months ended April 30, 2026 and 2025. The benefit of the tax exemption on net income (loss) per share (basic and diluted) were $nil per share for the six months ended April 30, 2026 and 2025. As the Company’s revenue are 100% generated from exempt income, the Company’s net operating loss is not eligible to carried forward for further taxable profit offset. No deferred tax assets were recognized as of April 30, 2026 and October 31, 2025.

 

United States

 

Pursuant to the U.S. Internal Revenue Code (the “Code”), U.S.-source income from the international operation of ships is generally exempt from U.S. tax if the company operating the ships meets certain requirements. Among other things, in order to qualify for this exemption, the company operating the ships must be incorporated in a country which grants an equivalent exemption from income taxes to U.S. corporations.

 

i) The components of the Group’s income tax provision are as follows:

 

   For the six
months ended
April 30,		   For the six
months ended
April 30,		 
   2026   2025 
Current  $
-
   $1,280 
Deferred   
-
    
-
 
Total  $
-
   $1,280 
ii) The following table summarizes the Group’s deferred tax assets resulting from differences between financial accounting basis and tax basis of assets and liabilities:

 

    

April 30,

2026

    October 31,
2025		 
Deferred tax liability:          
Depreciation for tangible assets  $
-
   $
-
 
Total  $
-
   $
-
 

 

The Group’s loss before income taxes consisted of:

 

  

For the six
months ended
April 30,

  

For the six
months ended
April 30,

 
   2026   2025 
Non-Singapore  $(5,804,776)  $(14,394,078)
Singapore   2,282,683    1,989,574 
Total  $(3,522,093)  $(12,404,504)

 

The following table reconciles the Singapore statutory rates to the Group’s effective tax rate for the six months ended April 30, 2026 and 2025.

 

   For the six
months ended
April 30,		   For the six
months ended
April 30,		 
   2026   2025 
Singapore Statutory income tax rate   17.0%   17.0%
Differential of local statutory tax rate   (28.0)%   (19.7)%
Effect of preferential tax rate   12.5%   2.9%
Non-deductible items and others *   (1.5)%   (0.2)%
Effective tax rate   
-
%   
-
%

 

* Non-deductible items and others represent excess expenses and losses not deductible for Singapore tax purpose.

 

(b) Taxes payable

 

Taxes payable consist of the following: 

 

  

April 30,

2026

   October 31,
2025		 
         
Income tax payable  $9,075   $9,213 
Total taxes payable  $9,075   $9,213