{"url_path":"/sec/wyhg/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 FINANCIAL INFORMATION**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-14","source_url":"https://www.sec.gov/Archives/edgar/data/1999860/0001213900-26-056618-index.html","accession_number":"0001213900-26-056618","cik":"0001999860","ticker":"WYHG","issuer_name":"Wing Yip Food Holdings Group Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1999860/0001213900-26-056618-index.html","primary_entity_key":"0001999860","primary_entity_name":"Wing Yip Food Holdings Group Ltd"},"word_count":1446,"has_tables":true,"body_markdown":"**Item 8. FINANCIAL INFORMATION**\n\n** **\n\nA. Consolidated Statements and Other Financial\nInformation\n\n \n\nWe have appended consolidated financial statements\nfiled as part of this annual report. See “Item 18. Financial Statements.”\n\n \n\n**Legal Proceedings**\n\n** **\n\nWe are currently not a party to any material legal\nproceeding. From time to time, however, we may be subject to various claims and legal actions arising in the ordinary course of business.\n\n \n\n**Dividend Policy**\n\n \n\nOur Ordinary Shares have been listed on KOSDAQ\nsince 2018, Wing Yip distributed dividends to its shareholders or investors for each fiscal year between 2019 and 2021. For the fiscal\nyears ended December 31, 2023, 2024 and 2025, we have not received any dividends or distributions from our subsidiaries, nor have we paid\nany dividends or distributions to our shareholders or U.S. investors. We might pay certain amount of cash dividends in the foreseeable\nfuture, depending on our financial performance for a specific fiscal year. Subject to the PFIC rules, the gross amount of distributions\nwe make to investors with respect to the ADSs (including the amount of any taxes withheld therefrom) will be taxable as a dividend, to\nthe extent that the distribution is paid out of our current or accumulated earnings and profits, as determined under U.S. federal income\ntax principles.\n\n \n\nSubject to our articles of association and applicable\nHong Kong law, our board of directors has discretion as to whether we will pay dividends in the future. Subject to our articles of association\nand applicable Hong Kong law, our shareholders in general meeting may declare dividends to be paid to the shareholders of the Company\nbut no dividend shall be declared in excess of the amount recommended by our board of directors. Under the applicable Hong Kong law, we\nmay not declare or pay dividends if there are reasonable grounds for believing that the Company has no distributable profit which could\nbe the result of the following scenarios: (a) we are, or would after the payment be, unable to pay our liabilities as they become due,\nor (b) the realizable value of our assets would thereby be less than our liabilities.  \n\n \n\nAs a holding company with no material operations\nof our own, we will be dependent on receipt of funds from Wing Yip GD. Mainland China regulations currently permit payment of dividends\nof a mainland China company only out of accumulated distributable after-tax profits as determined in accordance with its articles of association\nand the accounting standards and regulations in mainland China. In addition, dividends distributed from our PRC subsidiaries to us are\nsubject to PRC taxes, such as withholding tax.\n\n \n\nMainland China regulations may restrict the ability\nof our PRC subsidiaries to pay dividends to us. As a result, our ability to pay dividends and to finance any debt we may incur depends\nupon dividends paid by our subsidiaries. If our existing subsidiaries or any newly formed subsidiaries incur debt on their own behalf\nin the future, the instruments governing their debt may restrict their ability to pay dividends to us. The PRC regulatory authority also\nimposes certain restrictions on the conversion of RMB into foreign currencies and the remittance of currencies out of mainland China.\nTherefore, we may encounter difficulties in complying with the administrative requirements necessary to obtain and remit foreign currency\nfor the payment of dividends from our profits, if any.\n\n \n\n96\n\n \n\n \n\nThe principal regulations governing the distribution\nof dividends by companies in the mainland China include the Company Law of the PRC, which was promulgated by the SCNPC on December 29,\n1993, and was most recently amended on December 29, 2023 and became effective on July 1, 2024. Each of our PRC subsidiaries is required\nto set aside at least 10% of its after-tax profits each year, after making up for previous year’s accumulated losses, if any, to\nfund certain statutory common reserves, and may stop setting aside such after-tax profits after the aggregate amount of such funds reaches\n50% of its registered capital. And for the purpose of avoiding misunderstanding, this portion of our PRC subsidiaries’ respective\nstatutory common reserves are prohibited from being distributed to their shareholders as dividends, except in the event of liquidation.\nIf the shareholders’ meeting or the board of directors distributes the profits to the shareholders by violating the above-mentioned\nprovisions before the losses are made up and the statutory common reserves are drawn, the profits distributed shall be refunded to the\nCompany. Upon contribution to the statutory common reserve using their after-tax profits, our PRC subsidiaries may also make further contribution\nto the discretionary common reserve using after-tax profits in accordance with a resolution of the shareholders’ meeting. The above-mentioned\ncommon reserves shall be used to expanding the production and business scale, increase the registered capital or eliminate future losses\nin excess of retained earnings of the respective companies. According to the Company Law of the PRC, shareholders shall be distributed\nwith the dividends based on the percentages of the capital that they actually contributed. The exception shall be given if all shareholders\nagree that they will not be distributed with the dividends based on the percentages of the capital that they contributed.\n\n \n\nIn addition, the EIT Law and its implementation\nrules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by mainland China companies to non-mainland\nresident enterprises unless reduced under treaties or arrangements between the PRC central government and the governments of other countries\nor regions where the non-mainland resident enterprises are tax resident. Wing Yip may be considered as non-resident enterprises for tax\npurposes, so that any dividends paid by Wing Yip GD to Wing Yip may be regarded as Chinese mainland-sourced income and as a result may\nbe subject to mainland China withholding tax at a rate of up to 10%. Nevertheless, pursuant to the Arrangement between mainland China\nand the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the “Double Tax\nAvoidance Arrangement”, the withholding tax rate in respect of the payment of dividends by a mainland China enterprise to a Hong\nKong enterprise may be reduced to 5% from a standard rate of 10%. The 5% withholding tax rate, however, does not automatically apply and\ncertain requirements must be satisfied, including, without limitation, that (a) the Hong Kong entity must be the beneficial owner of the\nrelevant dividends; and (b) the Hong Kong entity must directly hold no less than a 25% share ownership in the mainland China entity during\nthe 12 consecutive months preceding its receipt of the dividends. In current practice, a Hong Kong entity must obtain a tax resident certificate\nfrom the Hong Kong tax authority to apply for the 5% lower mainland China withholding tax rate. As the Hong Kong tax authority will issue\nsuch a tax resident certificate on a case-by-case basis, we cannot assure you that we will be able to obtain the tax resident certificate\nfrom the relevant Hong Kong tax authority and enjoy the preferential withholding tax rate of 5% under the Double Tax Avoidance Arrangement\nwith respect to any dividends paid by our PRC subsidiary Wing Yip GD to Wing Yip. If the relevant tax authorities determine that our transactions\nor arrangements are for the primary purpose of enjoying a favorable tax treatment, the relevant tax authorities may adjust the favorable\nwithholding tax in the future. Accordingly, there is no assurance that the reduced 5% withholding rate will apply to dividends received\nby our Hong Kong holding company from our PRC subsidiaries. This withholding tax will reduce the amount of dividends we may receive from\nour PRC subsidiaries. See “Item 3. Key Information — D. Risk Factors — There are significant uncertainties under the\nEIT Law relating to the withholding tax liabilities of our operating subsidiaries in mainland China, and dividends payable by our operating\nsubsidiaries in mainland China to us may not qualify to enjoy certain treaty benefits.”\n\n \n\nIf we pay any dividends on our Ordinary Shares,\nwe will pay those dividends which are payable in respect of the Ordinary Shares underlying the ADSs to the depositary, as the registered\nholder of such Ordinary Shares, and the depositary then will pay such amounts to the ADS holders in proportion to the Ordinary Shares\nunderlying the ADSs held by such ADS holders, subject to the terms of the deposit agreement, including the fees and expenses payable thereunder.\nCash dividends, if any, on our Ordinary Shares will be paid in U.S. Dollars.\n\n \n\nB. Significant Changes\n\n \n\nExcept as disclosed elsewhere in this annual report,\nwe have not experienced any significant changes since the date of our audited consolidated financial statements included in this annual\nreport.\n\n \n\n97"}