Income Taxes

12 Months Ended

Mar. 31, 2026

Income Taxes [Abstract]

INCOME TAXES

Note 19 – INCOME TAXES

Cayman Islands

Akso Health was incorporated in the Cayman Islands and is not subject to income taxes or capital gain under current laws of Cayman Islands.

Hong Kong

We Healthy Limited and Akso Medi—care Limited are investment holding companies registered in Hong Kong and exempted from income tax on its foreign—derived income.

United States

The Company’s subsidiaries established in the U.S. are incorporated in the U.S. and is subject to both federal and state income taxes for its business operation in the U.S. The applicable tax rate is 21% for federal, 6.5% for We Health established in New York, 0% for Akso Remote Medical and Akso Online MediTech established in Wyoming and 8% for Akso First Health established in Massachusetts. All U.S. entities had no taxable income for the year ended March 31, 2026.

PRC

The Company’s subsidiaries established in the PRC are subject to the PRC statutory income tax rate of 25%, according to the PRC Enterprise Income Tax (“EIT”) law.

i) The components of income tax (benefit) expenses are as follows:

	For the Years Ended March 31,
	2026			2025			2024
Current	$	1,791		$	2,982		$	24,988
Deferred		(1,990,055	)		(30,804,128	)		—
Total	$	(1,988,264	)	$	(30,801,146	)	$	24,988

The significant components of deferred tax assets and deferred tax liabilities as of March 31, 2026 and 2025 was as below:

	As of March 31,
	2026			2025
Deferred tax assets
Net operating loss carryforwards in China	$	4,831,979		$	41,269,603
Allowance for credit loss		27,154			—
Total deferred tax assets	$	4,859,133		$	41,269,603
Deferred tax liabilities
Intangible assets from acquisition	$	(2,598,580	)	$	(32,580,236	)
Amortization		1,149,372			522,528
Intangible assets impairment		1,449,208			30,110,105
Total deferred tax liabilities	$	—		$	(1,947,603	)
Net deferred tax asset (liabilities) before allowance	$	4,859,133		$	39,322,000
Valuation allowance		(4,859,133	)		(41,269,603	)
Total net deferred tax (liability)	$	—		$	(1,947,603	)

All income taxes are related to income derived in the U.S. and PRC during the years ended March 31, 2026, 2025 and 2024.

The net (loss) income before taxes for the PRC entities was US$(19,436,534), US$(165,078,413) and US$83,103 for the years ended March 31, 2026, 2025 and 2024, respectively. The net (loss) income before taxes for the U.S. entities was US$(14,045), US$87,734 and US$(3,366,893) for the years ended March 31, 2026, 2025 and 2024, respectively.

The following table reconciles the PRC statutory rates to the Company’s effective tax rate for the years ended March 31, 2026, 2025 and 2024.

	For the Years Ended March 31,
	2026			2025			2024
PRC Income tax statutory rate		(25.0	)%		(25.0	)%		(25.0	)%
Effect of tax holiday and preferential tax rate		0.0	%		4.0	%		4.0	%
Non—deductible foreign losses		1.5	%		0.8	%		5.8	%
Change in valuation allowance		13.9	%		42.5	%		20.3	%
Non—deductible expenses and others		0.0	%		(3.8	)%		(5.4	)%
Effective tax rate		(9.6	)%		18.5	%		(0.3	)%

According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of income taxes is due to computational errors made by the taxpayer. The statute of limitations will be extended to five years under special circumstances, which are not clearly defined, but an underpayment of income tax liability exceeding US$14,497 (RMB 100,000) is specifically listed as a special circumstance. In the case of a transfer pricing related adjustment, the statute of limitations is ten years. There is no statute of limitations in the case of tax evasion. 

In accordance with the EIT Law, dividends, which arise from profits of foreign invested enterprises (“FIEs”) earned after January 1, 2008, are subject to a 10% withholding income tax. In addition, under the tax treaty between the PRC and Hong Kong, if the foreign investor is incorporated in Hong Kong and qualifies as the beneficial owner, the applicable withholding tax rate is reduced to 5%, if the investor holds at least 25% in the FIE, or 10%, if the investor holds less than 25% in the FIE. On July 19, 2018, the board of directors approved an annual dividend policy. Under this policy, annual dividends will be set at an amount equivalent to approximately 15—25% of the Company’s anticipated net income after tax in each year commencing from fiscal year ended March 31, 2020, which will be derived from the earnings of the Company’s PRC entities. The board of directors did not declare any annual dividend for the fiscal years ended March 31, 2026, 2025 and 2024, respectively.

A deferred tax liability should be recognized for the undistributed profits of PRC subsidiaries unless the Company has sufficient evidence to demonstrate that the undistributed dividends will be reinvested and the remittance of the dividends will be postponed indefinitely. The Company plans to indefinitely reinvest undistributed profits earned from its China subsidiaries in its operations in the PRC. Therefore, no withholding income taxes for undistributed profits of the Company’s subsidiaries have been provided as of March 31, 2026 and 2025. Under applicable accounting principles, a deferred tax liability should be recorded for taxable temporary differences attributable to the excess of the financial reporting basis over the tax basis in a domestic subsidiary. However, recognition is not required in situations where the tax law provides a means by which the reported amount of that investment can be recovered tax—free and the enterprise expects that it will ultimately use that means. The Company completed its feasibility analysis on a method, which the Company will ultimately execute if necessary to repatriate the undistributed earnings of the subsidiary without significant tax costs. As such, the Company does not accrue deferred tax liabilities on the earnings of the subsidiary given that the Company will ultimately use the means.