v3.26.3
Income taxes
 6 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
Income taxes

Note 14 – Income taxes

 

United States

 

KNOREX US was incorporated in the State of Delaware and holds its operation in the state of California. KNOREX US is subject to a federal income tax rate of 21% and California income tax rate of 8.84%.

 

Singapore

 

KNOREX SG is incorporated in Singapore and is subject to Singapore income tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Singapore tax laws. The applicable tax rate is 17% in Singapore, with 75% of the first US$7,415 (S$10,000) taxable income and 50% of the next US$140,887 (S$190,000) taxable income are exempted from income tax.

 

Vietnam

 

The Company’s subsidiary operating in Vietnam is subject to the Vietnam Income Tax at a standard income tax rate of 20%.

 

Other Countries

 

The Company’s other subsidiaries with operations in other countries (Malaysia, Australia, India, and China) are insignificant to its operations for the six months ended June 30, 2026 and 2025.

 

The United States and foreign components of loss before income taxes were comprised of the following:

 

  

For the

Six Months Ended

June 30, 2026

  

For the

Six Months Ended

June 30, 2025

 
   US$   US$ 
U.S. loss  $(403,873)  $(1,632,480)
Foreign loss   (5,007,886)   (2,910,830)
Total loss before income taxes  $(5,411,759)  $(4,543,310)

 

 

The provision for income taxes consisted of the following:

 

   

For the

Six Months Ended

June 30, 2026

    

For the

Six Months Ended

June 30, 2025

  
    US$     US$  
Current   $       $    
Federal     -       -  
State     891       28,851  
Foreign     21,480       42,773  
Deferred                
Federal     -       -  
State     -       -  
Foreign     20       3,139  
Provision for income taxes   $ 22,391     $ 74,763  

 

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

 

   

As of

June 30, 2026

    

As of

December 31, 2025

  
    US$     US$  
Deferred Tax Assets                
Net operating loss carryforwards – U.S.   $ 6,966,678     $ 6,821,392  
Net operating loss carryforwards – Singapore     4,969,659       4,605,688  
Net operating loss carryforwards – Other counties     451,417       714,248  
Less: valuation allowance     (12,387,754 )     (12,141,328 )
Deferred tax assets, net   $ -     $ -  

 

As of June 30, 2026 and December 31, 2025, the Company had net operating losses carry forward of approximately US$24.9 million and US$24.4 million, respectively, from the Company’s U.S. subsidiaries. The net operating losses can be carried forward indefinitely. Due to the Company’s U.S. subsidiaries have been operating at losses, the Company is uncertain when these net operating losses can be utilized. As a result, the Company provided a 100% allowance on deferred tax assets on net operating losses of approximately US$6.9 million and US$6.8 million related to U.S. subsidiary as of June 30, 2026 and December 31, 2025, respectively.

 

As of June 30, 2026 and December 31, 2025, the Company and its Singapore subsidiary had net operating losses carry forward of approximately US$29.0 million and US$27.0 million, respectively, from the Company and its Singapore subsidiary. The net operating losses from the Company and its Singapore subsidiary can be carried forward indefinitely. Due to the Company and its Singapore subsidiary have been operating at losses, the Company is uncertain when these net operating losses can be utilized. As a result, the Company provided a 100% allowance on deferred tax assets on net operating losses of approximately US$4.9 million and US$4.6 million related to the Company and its Singapore subsidiary as of June 30, 2026 and December 31, 2025, respectively.

 

 

The following is a supplemental schedule of cash paid for income taxes:

 

Schedule of supplemental schedule of cash paid for income taxes 

         
  

For the Six Months Ended

June 30,

 
  

2026

(Unaudited)

  

2025

(Unaudited)

 
Cash paid during the period for income taxes, net of refunds:          
Federal  $-   $- 
State and local   891    28,051 
Foreign   21,500    12,466 
Total cash paid during the period for income taxes  $22,391   $40,517 

 

Uncertain tax positions

 

The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. As of June 30, 2026 and December 31, 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur interest and penalties tax for the six months ended June 30, 2026 and 2025.