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Germany Crypto Tax Guide 2024

by
Pratibha Tiwari
Reviewed by
min read
Last updated:

Cryptocurrency has taken the world by storm, and Germany is no exception. But with the rise of crypto profits comes the responsibility of paying taxes on those gains. As a crypto investor in Germany, it's essential to understand the intricacies of crypto taxation to avoid legal issues or hefty fines. That's why we've created this comprehensive tax guide to help you navigate the complexities of crypto taxation in Germany. From calculating your taxes to reducing tax liabilities by HODLing assets, and everything in between, this guide has got you covered. 

Latest Updates/Regulations

09/06/23 - Updated to accommodate DAO, gifts, and donation taxes

09/06/23 - Updated to accommodate ICO taxes

EU’s sixth anti-money laundering directive

DAC-8

How Is Crypto Taxed In Germany?

As per the guidelines set forth by the Federal Ministry of Finance or, Bundesfinanzministeriums (BMF), all cryptocurrencies you’re holding are digital representations of value that are not issued or guaranteed by a central bank or public authority. This means that your crypto assets are not considered legal tender or currency, but are instead viewed as private assets for tax purposes.

Since cryptocurrency is considered a private asset, which is different from a property and has specific tax implications, any profits made from such transactions will be subject to individual Income Tax rather than Capital Gains Tax. Selling your crypto for fiat currency, swapping one crypto for another, or gifting crypto is considered a disposal in Germany and attracts tax liabilities. Capital gains are categorized as short-term or long-term based on the duration you hold them for. If you dispose of your assets within a year of acquisition, your gains will be considered short-term and will be subjected to income tax. An annual exemption of €600 is allowed per individual when it comes to short-term gains.

Holding your assets for over a year before disposal makes the transaction tax-free in Germany.

Tokens received as mining or staking rewards are considered additional income and you need to pay income tax on them. Every taxpayer is allowed an exemption limit of €256 when it comes to additional income. 

Example:

Consider the following transactions:

2022/02/13 - Sonia Buys 1 BTC for €10,000

2022/04/16 - Sonia Sells the BTC for €13,000

Capital Gain = €13,000 - €10,000 = €3,000

Now since it’s higher than the exemption amount of €600, it is taxable, but you can still reduce the exemption amount from your gain to get your actual tax base.

Tax Base = €3,000 - €600 = €2,400

Similarly, consider another set of transactions:

2022/05/19 - Sonia receives 6.25 BTC as mining rewards

Now assuming the market price of BTC at receipt to be €12,000

The total value of the tokens received = €12,000 * 6.25 = €75,000

And it’s way over the additional income exemption amount of €256. But you can reduce this amount from your income to get your tax base.

Tax base =  €75,000 - €256 = €74,744

This is the final amount you will have to pay taxes on.

Can the BZSt track crypto?

If you’re wondering whether you can hide some of your transactions from the BZSt by not reporting them on your tax report. The answer is a big no with an exclamation mark because the BZSt can access all your records and easily correlate your tax report with their database and figure out what’s wrong.

Ever since the EU’s sixth anti-money laundering directive was transposed into national law in December 2020, regulated entities in EU member states were mandated to comply with the new regulations by 3rd June 2021. These entities include any exchange offering financial services in the crypto space that now had to comply with harsher guidelines around when and how they identify their customers.

Anticipated to be implemented later this year, the forthcoming DAC-8 EU directive focused on data sharing is set to empower the Bundeszentralamt für Steuern (German Federal Central Tax Office) with the ability to authenticate an individual's ownership of cryptocurrencies. In accordance with the proposed directive, the German tax authority will be granted the authority to examine the financial documentation of cryptocurrency businesses, enabling them to obtain a comprehensive understanding of their crypto holdings.

Capital Gains Tax Germany

As previously mentioned, in Germany, short-term capital gains are treated as income and are subject to the standard rules of income tax. On the other hand, long-term gains are exempt from taxation. Therefore, it is advisable to adopt a cautious strategy by holding your assets for a period exceeding one year before selling them.

How to Calculate Crypto Gains & Losses

Calculating the gains or losses from your cryptocurrency investments is essential in tax jurisdictions that impose income tax on crypto sales. To determine your capital gain, you subtract the selling price from the purchase price, and if the result is positive, it’s gain, otherwise, it’s a loss. It's important to note that, for taxpayers in Germany, all values used in capital gains calculations must be denominated in Euros.

The standard formula to calculate capital gain is as follows:

Capital gain = Selling price – Purchase price

The selling price represents the value of the cryptocurrency at the time of disposal, and you can obtain it from an exchange or a popular price aggregator. However, establishing the purchase price can be challenging because you need to accurately determine the actual price you paid to acquire the asset.

Example

Consider the following transactions:

2022/03/14 - Michael bought 1 BTC for €12,000

2022/04/16 - Michael bought 3 ETH tokens for €1,400 each

2022/06/15 - Michael Sold 1 BTC for €20,000

2023/05/01 - Michael sold 3 ETH for €1,800 each

Now since the BTC disposition was within a year of acquisition, the gains will be taxable under the income tax rules.

Capital Gain =  Disposal amount - Cost Basis = €20,000 - €12,000 = €8,000

However, the ETH disposition was done after holding the tokens for over 12 months. Hence, the transaction attracts no tax obligation.

Crypto Losses Germany

In the event that you have sold cryptocurrency within a year and experienced a loss instead of a gain, you will not be obligated to pay taxes on it. However, it is crucial to maintain records of these losses, as they can be utilized to offset any forthcoming gains, resulting in a decrease in your overall tax obligations.

If you do not have any gains to offset, the German Tax Act permits you to carry forward your losses to subsequent financial years. This provision allows you to reduce your tax liability on potential future gains, providing a beneficial mechanism for optimizing your tax situation.

Lost and Stolen Crypto

In the unfortunate event that you have suffered the loss of your cryptocurrency as a result of fraudulent activity or crypto rug pulls, there may be a possibility to claim it as a loss. However, it is important to note that the specific criteria for claiming such a loss have not been explicitly defined by the BZSt (Bundeszentralamt für Steuern, German Federal Central Tax Office).

We recommend contacting the BZSt directly to discuss your situation and provide them with all the relevant information, such as:

  • When you acquired and lost the private key
  • The wallet address
  • The cost incurred to acquire the lost or stolen cryptocurrency 
  • Amount of cryptocurrency in the wallet at the time of loss 
  • Evidence that the wallet was under your control 
  • And any transactions linked to your identity or a verified account on a digital currency exchange. 

If your claim is approved by the BZSt, it can be used to offset other income tax you have in the same tax year.

Crypto Tax Breaks Germany

Although there is no legal way to avoid paying crypto taxes entirely, here are some ways you can pay less crypto taxes:

  1. HODL your assets for over a year
  2. Use tax-free exemptions such as €600 for short-term gains and €260 for additional income
  3. Track and harvest losses to lower your tax bill
  4. Use DeFi transactions strategically to avoid paying taxes on such transactions
  5. Gift your assets to your spouse if they fall in a lower tax bracket
  6. Keep track of allowable expenses like gas, transaction, slippage, and network fees and deduct them to lower your tax bill.

Crypto Cost-Basis Method Germany

If you're unable to determine the purchase price, a conservative approach would be to consider it as zero. However, you'll have to pay tax on the full amount, which may result in extra taxes.

But it would be unfair for you to pay tax on the full amount.

The BZSt has clear guidelines on how to calculate the purchase price or cost basis of your crypto assets. Individual identification can be used when possible, and you must have access to supporting documents. However, when individual identification is not possible, the recommended method for accounting is First in First out (FIFO), which involves selling the oldest coins first.

Example

Consider the following transactions:

2022/01/13 - Selim bought 1 BTC for €11,000

2022/01/23 - Selim bought another BTC for €11,500

2022/02/13 - Selim bought 2 ETH tokens for €1,000 each

2022/04/11 - Selim bought 1 ETH for €1,200

2022/06/04 - Selim sold 1 BTC for €14,000

2022/06/24 - Selim sold 1 Eth for €1,300

2022/08/26 - Selim sold the remaining BTC for €15,000 and the balance ETH tokens for €1,500

Note that we’re using the FIFO accounting method for capital gain calculations.

Now, as evident from the above ledger of transactions a total of 3 disposals were made. 

Gain from 1st Disposal

The first disposal was made on 2022/06/04.

1 BTC sold for €14,000

Since we are using the FIFO accounting method, this BTC is the same one acquired on 2022/01/13 for €11,000

Capital Gain = Disposal Amount - Cost Basis = €14,000 - €11,000 = €3,000

Gain from 2nd Disposal

The 2nd disposal was made on 2022/06/24.

1 ETH sold for €1,300.

This ETH token is the same one acquired on 2022/02/13 for €1,000

Capital Gain =  Disposal amount - Cost Basis =  €1,300 - €1,000 = €300

Gain From 3rd Disposal

 The 3rd disposal was made on 2022/08/26.

2 ETH sold for €1,500

1 BTC sold for €15,000

Now the BTC disposal is pretty straightforward. It’s the same one that was acquired on 2022/01/23 for €11,500.

Gain from BTC disposal = €15,000 - €11,500 = 3,500

The ETH disposal is somewhat complicated because if we go by the FIFO accounting rule, one of the ETH tokens disposed of was acquired for €1,000 (let’s call it ETH1) while the other was acquired for €1,200 (let’s call it ETH2). So the gains will be different for both tokens:

Gain for ETH 1 = €1,500 - €1,000 = €500

Gain for ETH 2 = €1,500 - €1,200 = €300

Total Capital Gain

Total Gain = €3,000 + €3,00 + €3,500 + €500 + €300 = €7,600

And since the tax authorities offer an exemption of €600 when it comes to short-term gains, you can deduct that from the total amount to get your tax base.

Tax Base =  €7,600 - €6,00 = €7,000

Crypto Income Tax Germany

As cryptocurrencies are classified as private property, they are not subject to Capital Gains Tax as is the case with stocks or equities. However, gains from the sale of cryptocurrencies are subject to Income Tax 

Short-Term Trade

If you have held your cryptocurrency for less than a year before disposing of it, you will be subject to regular income tax on the resulting profits. This covers all forms of disposition, including selling cryptocurrency for fiat currency, exchanging it for a different type of cryptocurrency, or using cryptocurrency to purchase goods or services. Moreover, it’s worth noting that you're allowed a tax-free limit of €600 per calendar year.

Long-Term Trade

Want to save crypto tax in Germany?

Waiting for at least a year before selling your crypto can help you avoid taxes altogether, which is good news for German crypto investors who are willing to exercise patience.

In addition to the previously mentioned long-term and short-term taxable events, certain cryptocurrency transactions such as mining or staking rewards are also classified as income and are subject to Income Tax.

We will discuss them in detail, before that, let's now delve into the Income Tax rates to gain insight into how much you might owe.

Income Tax Rate Germany

The amount of tax you pay will depend on your individual Income Tax rate, which can range from 0% to 45% based on your total income during the tax year. This table shows the Income Tax Rates for the year 2022.

Income Tax Rate

Planning ahead? Here’s the tax rate for 2023.

It's important to note that these tax rates don't include the additional solidarity surcharge tax (Solidaritätszuschlag or 'Soli') of 5.5%, which applies to single taxpayers who pay more than €16,956 in income tax and married taxpayers who pay more than €33,912.

How to Calculate Crypto Income

As already mentioned, most transactions that result in a gain are taxed as income, moreover, income from mining and staking is considered additional income and is taxed under the income tax regime as well.

So all you need to do is add up the individual gains and losses from the pile of transactions and the tax base you end up with is your final income.

Tax-Free Crypto Transactions Germany

If you’ve been involved with any of these transactions you are not liable for tax (except for a few cases) in Germany. 

  • Selling cryptocurrency held for more than one year
  • Giving cryptocurrency as a gift to friends and family
  • Earning less than €600 in short-term gains and income within a year
  • Purchasing cryptocurrency using EUR
  • Selling staked or loaned cryptocurrency after one year
  • Transferring cryptocurrency between wallets
  • Receiving an airdrop without any action on your part
  • New coins received through hard forks
  • Receiving and redeeming utility tokens

Note: In some cases, airdrops and hard forks are tax-liable crypto transactions, which we will discuss later.

Taxed Crypto Transactions Germany

If you engage in any of the following activities within one year, you may be subject to taxation.

  • Selling cryptocurrency for fiat currency 
  • Exchanging cryptocurrency for another coin
  • Using cryptocurrency to purchase goods or services
  • Investing in an ICO or IEO, earning cryptocurrency as income, &
  • Receiving Cryptocurrency through mining or staking activities

Tax on Mining Crypto Germany

In Germany, engaging in mining activities triggers taxable events, regardless of the type of token being mined. If you have participated in mining and have received tokens as rewards, these tokens will be subject to income tax.

It's important to keep in mind that any expenses associated with the mining process can be claimed as tax deductions. These costs should be subtracted from the fair market value of the tokens at the time of receipt. The resulting value will serve as your taxable income base.

Furthermore, when you decide to dispose of these assets by selling, swapping, or gifting them, you will be required to pay income tax on the day of the transaction.

Tax on Staking Crypto Germany

Although mining and staking activities are vastly different, both mining and staking rewards are treated the same for tax purposes. The BZSt has clarified that any staking rewards will be taxed as additional income and will inherit the cost base equal to the fair market value of the tokens on receipt.

You’ll also be taxed if you ever decide to dispose of these tokens incurring a capital gain, although if you hold these tokens for over a year before disposing of them, you’ll have to pay no taxes.

Crypto Margin Trading, Futures and CFDs

Crypto users who engage in margin and futures trading can make higher gains but also face more risk. Currently, there is no official guidance on how such trading should be taxed in Germany, but existing regulations on margin, futures, and derivatives trading in traditional financial markets can be leaned on. If trading positions are settled in cryptocurrency, they will be subject to Income Tax, and if settled in non-crypto assets, they will likely be subject to Capital Income tax. Taxation occurs at the time the position is closed, and it is recommended to seek advice from a professional tax advisor for specific situations.

Crypto Gifts and Donations Tax

In Germany, gifting Bitcoin or other cryptocurrencies to your loved ones is treated like any other gift. Gifts are exempt from taxes up to €20,000 for friends and up to €500,000 for spouses. Amounts exceeding these limits are subject to the "Schenkungssteuer," which has varying tax rates depending on the recipient (e.g., spouse, children, parents, siblings, or friends). Tax rates for gifts range from 7% to 50%. The tax exemption limits reset every 10 years.

Crypto donations on the other hand are a grey area when it comes to crypto taxation in Germany, we will add more details regarding their taxation as soon as more guidelines on the matter are accessible.

NFT Taxes Germany

NFTs are treated by tax authorities in a manner similar to other tokens, resulting in comparable tax implications for these crypto assets, unless you happen to be the creator of the NFTs.

If you own NFTs and decide to sell them within one year of acquiring them, any gains obtained will be subject to income tax. However, if you hold onto them for more than a year, all the gains derived from their sale will be considered tax-free.

On the other hand, if you are a creator who mints NFTs from the blockchain and sells them for a profit, the income generated will be regarded as artistic or business income from a tax perspective, thus attracting income tax. There is a possibility that these transactions may also be subject to trade tax. However, the BMF (Federal Ministry of Finance) has yet to release guidelines concerning the taxation of NFTs. Therefore, we recommend consulting a tax expert to gain a better understanding of the tax implications associated with NFTs.

Crypto ICO Taxes

Crypto ICOs are special fundraiser events that allow investors to buy tokens from an unreleased project, similar to IPOs in traditional securities markets. The transactions usually involve mainstream tokens like BTC and ETH. 

The BZSt views these transactions as crypto-to-crypto trades and these transactions constitute a taxable event. The tokens inherit the cost base equal to the FMV of these tokens at the time of receipt.

Note that you only pay taxes when you dispose of these tokens within a year of receiving them. If you’ve held these tokens for over a year before disposing of them, you’ll attract no tax obligations.

DAO Taxes

There is no clear guidance from BZSt when it comes to income from DAOs. Although there’s a high chance that this income will be treated as additional income and taxed accordingly, we suggest seeking guidance from an experienced tax advisor regarding income from DAOs.

We will be adding more details here as soon as new guidelines hit our radar.

DeFi Crypto Taxes Germany

DeFi, or decentralized finance, is a relatively new market, and like many other tax offices, the BZSt in Germany is yet to release detailed guidance on how DeFi investments will be taxed. However, this does not mean that DeFi investors will not have to pay taxes on their transactions. Instead, investors will need to interpret the current guidance on crypto tax from the BZSt and apply it to their DeFi investments. Alternatively, consulting with an experienced crypto accountant is recommended to navigate the complex tax landscape surrounding DeFi.

When it comes to DeFi tax implications, there are a couple of potential scenarios to consider. 

First, earning new tokens via DeFi protocols, such as staking, liquidity mining, or yield farming, is likely to be viewed by the BZSt as additional income. As such, new tokens or coins received through these transactions will be subject to Income Tax upon receipt if the investor's additional income exceeds €256.

Second, trading tokens that accrue value in DeFi protocols can also result in taxable transactions. Many DeFi protocols issue liquidity pool tokens instead of new tokens, which represent the investor's capital in the pool and can accrue value based on the rewards received from being in the pool. When an investor withdraws their capital by trading their liquidity pool tokens back, they realize a profit, which may be subject to taxation depending on how long they have held their original capital and their liquidity pool tokens.

How are Airdrops and Forks taxed in Germany?

Airdrops

Tokens received via airdrops may or may not be taxable depending on the recipient's actions. If the recipient acted to be eligible for the airdrop, then the airdrops will be considered as income and will therefore attract income tax.

If the recipient didn’t do anything in return for the airdrop, the sale of the assets received will not be considered a taxable event by the tax authorities.

Forks

Since soft forks result in no new tokens being issued to the users, it is considered a non-taxable event. As far as hard forks are concerned the BMF has clarified that for private investors, you do not need to pay Income Tax upon receipt of crypto as a result of a hard fork. However, if you sell this crypto within one year of receipt, you'll need to pay Income Tax if it's valued at more than €600.

When to Report Crypto Tax in Germany

As a taxpayer, the deadline to submit your tax return for the previous year is May 31st of the following year. For example, if you earned income in 2022, you are required to submit your tax return by May 31st, 2023.

However, if you engage a tax advisor, they can submit your tax return by December 31st of the following year. For instance, if you engage a tax advisor for the 2022 tax year, they would have until December 31st, 2023 to submit your tax return.

How to File Crypto Taxes in Germany

Any profits or income you’ve made from crypto assets must be reported to the BZSt on your tax report. So once you’ve figured out your taxable income and capital gains base, you can choose any one of the following channels to file your taxes:

  1. Through ELSTER(online tax filing portal)
  2. Using paper forms

Filing taxes using ELSTER

Follow the steps listed below to file your taxes online without facing any blockers midway through:

  1. Go to the ELSTER website and register for an account. You will need your personal information, including your name, address, and tax identification number (TIN).
  1. After registering, download the ELSTER software to your computer. The software is available for free on the ELSTER website.
  1. Open the ELSTER software and enter your tax information. The software will guide you through the process, and you can save your progress and come back to it later if needed.
  1. When you have completed your tax return, submit it using the ELSTER software. You will receive a confirmation that your tax return has been submitted.
  1. After submitting your tax return, you will need to sign it electronically using your ELSTER certificate. If you don't have an ELSTER certificate yet, you can apply for one on the ELSTER website.
  1. After submitting your tax return, you will receive a tax assessment from the tax office. This will let you know if you owe additional taxes or if you are entitled to a refund.

Filing Taxes Using Paper Forms

To file your taxes the traditional way using paper forms. You will need the following forms to accurately report all your transactions:

  1. Hauptvordruck ESt 1 A (The General Tax Form)

You need to fill out Form Hauptvordruck ESt 1 A to report all your capital gains and income made from any source except crypto. This form solicits regular income tax data.

  1. Anlage SO(For Other Income)

This form is for the capital gains and income you’ve made from crypto assets. You need to report all your crypto transactions and the gains you’ve made over the entire tax year.

What Crypto Records Will the BZSt Want?

Like most other tax authorities, the BZSt expects you to keep a detailed record of all your transactions from the past 5 years. You’re expected to maintain the following records:

  1. Date of your crypto transactions
  2. The value of crypto at the time of the transaction
  3. Details about the nature of the transaction and the participants involved

Maintaining these records manually is an intimidating task and you may end up in legal trouble if you miss reporting some transactions. A smarter way to record-keeping is to use tax software like Kryptos, which can auto-fetch all your transactions from across a pool of more than 1,200 exchanges and wallets to the central dashboard and even accounts for real-time transactions with features like auto-sync. 

How to File Crypto Taxes Using Kryptos?

Now that you’re aware of how your crypto transactions are taxed and what forms you need to fill out to complete your tax report, here’s a step-wise breakdown of how Kryptos can make this task easier for you:

  1. Visit Kryptos and sign up using your email or Google/Apple Account
  2. Choose your country, currency, time zone, and accounting method 
  3. Import all your transactions from wallets and crypto exchanges
  4. Choose your preferred report and click on generate report option on the left side of your screen and let Kryptos do all the accounting.
  5. Once your Tax report is ready, you can download it in PDF format.

If you still have any doubts regarding the integrations or generating your tax reports, you refer to our video guide here.

What Crypto Records will the BZSt want?

Similar to many tax offices around the globe, the BZSt expects you to maintain detailed records from the past 5 years. Given below is a list of records tax authorities expect you to maintain in Germany:

  • Data and time of crypto Transactions
  • The fair market value of your assets at the time of disposal
  • The specific circumstances of the transaction and the parties involved in it

How to File Crypto Taxes Using Kryptos?

Now that you’re aware of how your crypto transactions are taxed and what forms you need to fill out to complete your tax report, here’s a step-wise breakdown of how Kryptos can make this task easier for you:

  1. Visit Kryptos and sign up using your email or Google/Apple Account
  2. Choose your country, currency, time zone, and accounting method 
  3. Import all your transactions from wallets and crypto exchanges
  4. Choose your preferred report and click on generate report option on the left side of your screen and let Kryptos do all the accounting.
  5. Once your Tax report is ready, you can download it in PDF format.

If you still have any doubts regarding the integrations or generating your tax reports, you refer to our video guide here.

How to Avoid Tax on Crypto in Germany

Although it’s impossible to avoid your crypto taxes entirely in a legally compliant way. However, you can reduce your tax bill without getting into legal trouble with the tax authorities. Here are some of them:

  • Hold your assets for more than a year to avoid paying any taxes
  • Use tax-loss harvesting to reduce your capital gains
  • Choose your assets strategically when getting involved in DeFi transactions
  • Utilize your tax-free thresholds 
  • Gift crypto assets to your spouse if they happen to be in a lower tax bracket
  • Mining expenses, gas fees, transaction fees, and software preparation fees are tax-deductible expenses in Germany, use them to lower your tax bill

FAQs

1. Is crypto Legal in Germany?

Yes, cryptocurrency is legal in Germany. The German government recognizes cryptocurrencies as a digital representation of value and a form of private money. The use of cryptocurrencies is not restricted in Germany, and individuals and businesses can buy, hold, and trade cryptocurrencies freely. However, businesses that deal with cryptocurrencies are subject to regulatory requirements, such as registration with financial authorities and compliance with anti-money laundering regulations. Additionally, cryptocurrency-related income is subject to taxation in Germany, and individuals and businesses are required to report their cryptocurrency holdings and transactions to the tax authorities.

2. How to Calculate and File Your Crypto Taxes in Germany Using Kryptos?

Filing your crypto tax all on your own is quite a cumbersome task and you might need some assistance to make sure nothing goes wrong and you don’t end up in legal trouble just because you missed reporting a couple of transactions on your tax report. Kryptos can help you with this with its smart software-based crypto taxation solution that can auto-fetch all your transactions and generate a legally compliant tax report in a matter of minutes. And all of this while you chill on your couch.

3. How is Crypto taxed in Germany?

In Germany, cryptocurrencies are considered private money or assets and are therefore subject to taxation. The taxation of cryptocurrencies in Germany depends on the individual circumstances of the taxpayer and the purpose for which the cryptocurrency was acquired.

  • Capital Gains Tax: If you buy and sell cryptocurrencies as a private investor, any gains you make are subject to capital gains tax. If you hold the cryptocurrency for more than one year, you may be eligible for a reduced tax rate.
  • Income Tax: If you receive cryptocurrencies as payment for goods or services, you must declare the value of the cryptocurrency received as income and pay income tax on it.
  • Mining: If you mine cryptocurrencies as a business, any income you receive is subject to income tax.
  • VAT: Cryptocurrency transactions are generally exempt from VAT in Germany. However, if you sell goods or services for cryptocurrency, you may have to pay VAT on the value of the goods or services sold.

4. How can Kryptos help you in filing your crypto taxes?

We agree that filing your crypto taxes is an unreasonably complicated task, even for someone with a fair amount of prior knowledge. However, there’s an easy way to file your crypto taxes using a crypto tax software called Kryptos.

All you need to do is log in on the platform, add all your trading accounts, wallets, and DeFi accounts and sip coffee while Kryptos does all the heavy lifting. The platform can auto-fetch all your transaction from the tax year and generate a legally compliant tax report within minutes while suggesting ways to lower your tax bill. It works like magic all you need to do is try it once.

5. How much tax do you pay on crypto in Germany?

The amount of tax you pay on crypto in Germany depends on your circumstances and the purpose for which the cryptocurrency was acquired.

For capital gains tax, the tax rate is determined by your income tax rate and the length of time you held the cryptocurrency before selling it. If you hold the cryptocurrency for more than one year, you may be eligible for a reduced tax rate. The capital gains tax rate in Germany ranges from 0% to 45%, with a maximum rate of 25% for long-term gains.

For income tax, the tax rate is based on your income tax rate and the value of the cryptocurrency received as income.

For mining, the tax rate is based on your income tax rate and the income received from mining activities.

It's important to note that the tax treatment of cryptocurrencies in Germany is complex and can vary depending on individual circumstances. It's recommended to consult with a tax professional or accountant to ensure you comply with all applicable tax laws and to determine the exact amount of tax you will need to pay.

All content on Kryptos serves general informational purposes only. It's not intended to replace any professional advice from licensed accountants, attorneys, or certified financial and tax professionals. The information is completed to the best of our knowledge and we at Kryptos do not claim either correctness or accuracy of the same. Before taking any tax position / stance, you should always consider seeking independent legal, financial, taxation or other advice from the professionals. Kryptos is not liable for any loss caused from the use of, or by placing reliance on, the information on this website. Kryptos disclaims any responsibility for the accuracy or adequacy of any positions taken by you in your tax returns. Thank you for being part of our community, and we're excited to continue guiding you on your crypto journey!