Income Taxes

9 Months Ended

Nov. 30, 2019

Notes To Financial Statements [Abstract]

Income Taxes

Note 14 - Income Taxes

The Company and its subsidiaries file separate income tax returns.

The United States of America

FingerMotion, Inc. is incorporated in the State of Delaware in the U.S. and is subject to a U.S. federal corporate income tax of 21%. The Company generated a taxable loss for the nine months ended November 30, 2019 and 2018.

Hong Kong

Finger Motion Company Limited is incorporated in Hong Kong and Hong Kong’s profits tax rate is 16.5%. Finger Motion Company Limited did not earn any income that was derived in Hong Kong for the nine months ended November 30, 2019 and 2018.

The People’s Republic of China (PRC)

JiuGe Management, JiuGe Technology and Beijing XunLian were incorporated in the People’s Republic of China and subject to PRC income tax at 25%. JiuGe Management, JiuGe Technology and Beijing XunLian did not generate taxable income in the People’s Republic of China for the nine months ended November 30, 2019.

Income tax mainly consists of foreign income tax at statutory rates and the effects of permanent and temporary differences. The Company’s effective income tax rates for the nine months ended November 30, 2019 and 2018 are as follows:

	For the nine months ended November 30,
	2019			2018
	(Unaudited)			(Unaudited)
U.S. statutory tax rate		21.0	%		21.0	%
Foreign income not registered in the U.S.		(21.0	%)		(21.0	%)
PRC profit tax rate		25.0	%		25.0	%
Changes in valuation allowance and others		(25.0	%)		(25.0	%)
Effective tax rate		0.0	%		0.0	%

At November 30, 2019 and February 28, 2019, the Company has a deferred tax asset of $568,967 and $236,331, resulting from certain net operating losses in U.S., respectively. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those net operating losses are available. The Company considers projected future taxable income and tax planning strategies in making its assessment. At present, the Company concludes that it is more-likely-than-not that the Company will be able to realize all of its tax benefits in the near future and therefore a valuation allowance has been provided for the full value of the deferred tax asset. A valuation allowance will be maintained until sufficient positive evidence exists to support the reversal of any portion or all of the valuation allowance. At November 30, 2019 and February 28, 2019, the valuation allowance was $568,967 and $236,331, respectively.

	November 30, 2019			February 28, 2019
		(Unaudited)
Deferred tax asset from operating losses carry-forwards	$	568,967		$	236,331
Valuation allowance		(568,967	)		(236,331	)
Deferred tax asset, net	$	—		$	—