v3.26.3
INCOME TAX
 12 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
INCOME TAX

NOTE 17 - INCOME TAX

 

For the years ended June 30, 2026, and 2025, the local (“U.S. of America”) and foreign components of loss before income taxes were comprised of the following:

 

       
   Years ended June 30, 
   2026   2025 
Tax jurisdiction from:          
Local (U.S. regime)  $(3,195,379)  $(4,845,138)
Foreign, including          
British Virgin Island   121,074    472,865 
Malaysia   (319,809)   (398,431)
Singapore   (8,516)   - 
Labuan, Malaysia   20,603    (12,309)
           
Loss before income taxes  $(3,382,027)  $(4,783,013)

 

The provision for income taxes consisted of the following:

       
   Years ended June 30, 
   2026   2025 
           
Current tax:  $-   $- 
Local   -    - 
Foreign   -    - 
           
Deferred tax          
Local   -    - 
Foreign   -    - 
           
Income tax expense (benefit)  $-   $- 

 

The effective tax rate in the years presented reflects the impact of losses incurred across various tax jurisdictions, each with different applicable income tax rates.

 

The Company mainly operates in the United States and Malaysia and is subject to taxes in the jurisdictions in which it operates as follows:

 

United States of America

 

VRDR, Verde Renewables, VerdePlus and VLI are subject to the tax laws of the U.S.

 

 

VERDE RESOURCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

  ● The U.S. federal corporate income tax rate is 21%, effective January 1, 2018.
     
  ● The Company’s policy is to recognize accrued interest and penalties related to unrecognized tax benefits in its income tax provision.
     
  ● No material interest or penalties were accrued or paid during the years presented.
     
  ● The Company has recorded a valuation allowance against the net deferred tax assets of $2,504,277 related to net operating loss (“NOL”) carryforwards of $12,159,345 and liabilities carried forward on share-based compensation of $234,213, as management believes it is more likely than not that these deferred tax assets will not be realized.
     
  ● NOLs generated prior to January 1, 2018 may be carried forward for up to 20 years.
     
  ● NOLs generated on or after January 1, 2018 may be carried forward indefinitely; however, NOLs arising from tax years ending after December 31, 2020 may only offset up to 80% of taxable income.
     
  ● For the years ended June 30, 2026 and 2025, the Company had no taxable income under the applicable U.S. tax regime.

 

British Virgin Islands (“BVI”)

 

Under current BVI law, VRAP is not subject to income tax.

 

Labuan

 

BRL is subject to the tax laws applicable to Labuan entities.

 

  ● Income derived from intellectual property is subject to the Malaysian Income Tax Act 1967 (“ITA”) at a tax rate of 24% of chargeable income.
     
  ● BRL was administratively dissolved by being struck off the registers of the Labuan Financial Services Authority on October 19, 2025.

 

Malaysia

 

Verde Malaysia and Wision are incorporated in Malaysia and are subject to Malaysian income tax.

 

  ● The standard Malaysian corporate income tax rate is 24% on chargeable income.
     
  ● As of June 30, 2026, the Malaysian operations had cumulative net operating losses of $1,076,151, which may be carried forward for up to ten (10) years under current Malaysian tax legislation.
     
  ● The Company has recorded a full valuation allowance against deferred tax assets of $258,276 related to these NOL carryforwards, as management believes it is more likely than not that the deferred tax assets will not be realized.

 

 

VERDE RESOURCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

Singapore

 

The Company operates in Singapore through its wholly owned subsidiary, VRAPPL.

 

  ● Income earned by VRAPPL is subject to the Singapore corporate income tax rate of 17%.
     
  ● For its first three consecutive Years of Assessment (“YA”), VRAPPL qualifies for the Singapore Tax Exemption Scheme for New Start-ups, which provides:

 

  ○ 75% tax exemption on the first S$100,000 of normal chargeable income.
     
  ○ 50% tax exemption on the next S$100,000 of normal chargeable income.

 

  ● As of June 30, 2026, the Singapore operations had cumulative net operating losses of $7,244, which may be carried forward to offset future taxable income.

 

A reconciliation of the income tax expense, net, computed using the applicable statutory income tax rates in the jurisdictions in which the Company operates to the Company’s actual income tax expense is as follows:

 

      %      % 
   Years Ended 
   June 30, 2026   June 30, 2025 
   USD   %   USD   % 
Loss before income tax expense  $3,382,027        $4,783,013      
Statutory income tax rate   21%        21%     
Income tax expense at statutory rate   (710,226)   21.0%   (1,004,433)   21.0%
Foreign tax rate differential (1)                    
Malaysia   (9,594)   0.3%   (11,953)   0.2%
Singapore   341    0%   -    0%
Increases (decreases) due to:                    
Non-deductible expenses   182,474    (5.4)%   82,412    (1.7)%
Non-taxable income   (29,752)   0.9%   (2,585)   0.1%
Temporary differences   (103,774)   3.1%   131,585    (2.8)%
Change in valuation allowance   670,531    (19.9)%   804,974    (16.8)%
Income tax expense  $-    -%  $-    -%

 

  (1) Represents the impact of varying tax jurisdictions, primarily the rate differentials between the Malaysia statutory rate (subject to 24%) and Singapore statutory rate (subject to 17%).

 

The following table sets forth the significant components of the deferred tax assets of the Company:

 

       
   As of June 30, 
   2026   2025 
Deferred tax liability:          
Share based compensation  $

(49,185

)  $

(152,959

)
           
Deferred tax assets:          
Net operating loss carry forwards, from          
US tax regime  $2,553,462   $1,996,240 
Malaysia tax regime   258,276    249,972 
Singapore tax regime   1,231    - 
Less: valuation allowance   (2,763,784)   (2,093,253)
Deferred tax assets, net  $-   $- 

 

 

VERDE RESOURCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

The Company has recorded valuation allowances for certain tax attribute carry forwards and other deferred tax assets due to uncertainty that exists regarding future realizability. If in the future the Company believes that it is more likely than not that these deferred tax benefits will be realized, the majority of the valuation allowances will be reversed in the consolidated statement of operations. The Company did not have uncertainty tax positions or events leading to uncertainty tax position within the next 12 months.