Cryptocurrency transactions in Germany are subject to specific tax rules, mainly based on holding period and type of income. In this article, you’ll find out which transactions are taxable, when they are tax-free, and other important details.
Capital gains tax
When you dispose of your crypto-assets, such as by selling, trading, or spending them you may be liable to pay tax on the gain, depending on how long you held the assets.
short-term (held less than 1 year): profits are taxed at your personal Income Tax rate (up to 45% + 5.5% solidarity surcharge)
long-term (held more than 1 year): profits are tax-free
The holding period does not reset upon transferring crypto between your wallets, inheritance or gifting. The holding period only resets if the crypto is disposed of (sold or exchanged for value).
Disposals that trigger a capital gain or loss
The following are common types of outgoing transactions that trigger capital gains calculation in Germany:
selling: selling crypto for EUR or another fiat currency
swapping: exchanging crypto for other cryptocurrencies, including stablecoins
payments: using crypto to purchase goods or services
gifting: giving crypto away (unless the recipient is your spouse or within tax-free thresholds)
deposit on DeFi: depositing crypto on DeFi platforms and receiving other crypto in return
NFT transactions: selling, swapping, or buying NFTs with crypto held less than a year
Disposals that don't trigger a capital gain or loss
The following are common types of outgoing transactions that don't trigger capital gains calculation in Germany:
internal transfer: sending crypto from one of your wallets or exchanges to another of yours
deposit on DeFi: depositing crypto on DeFi platforms without receiving other crypto in return
moving crypto: transferring crypto between your own wallets, exchanges, or accounts
Capital gains tax allowance
If your total net crypto gains in a year are less than €1000, you do not need to pay tax or file a return for those gains.
Example:
If you made €500 in crypto gains during the year, you would not pay any tax. If you made €2,500 in gains, you would only pay tax on the amount above €1000—that is, on €1,500.
How to calculate capital gain
Capital gain is calculated as the difference between sale proceeds and the cost basis. To determine the cost basis you mus use the the FIFO (First In, First Out) method for calculating which assets are sold, with a wallet-by-wallet approach.
To learn more about calculation methods, see the dedicated article.
Offsetting capital loss
You can offset capital losses from crypto sold within a year against your gains, reducing your taxable gains. Unused losses can be carried forward if reported in your tax return.
You may claim a loss for lost or stolen crypto if you provide sufficient evidence (wallet addresses, proof of ownership, acquisition and loss dates, etc.) to the tax authorities (BZSt).
Income Tax
In Germany, income tax on crypto applies when you receive cryptocurrency as a form of income. You are liable to pay Income Tax on crypto received from:
employment income: receiving your salary or wages in cryptocurrency
mining rewards: earning crypto as a reward for mining
staking rewards: receiving crypto for staking
DeFi rewards: earning rewards from liquidity mining, yield farming, or lending
taxable airdrops: obtaining crypto in exchange for actions (e.g., promoting a project)
NFT minting/sales: income from minting and selling NFTs as an artist or business
ICOs/IEOs: new tokens received and disposed of within a year
You only need to file a tax return if your additional income from these sources exceeds €256 per year.
Inheritance tax
Cryptocurrencies inherited as part of an estate are subject to Erbschaftsteuer (inheritance tax). The taxable value is determined by the market value of the cryptocurrency at the time of inheritance.
Tax rates and allowances depend on the relationship between the deceased and the heir: for example, spouses have a €500,000 allowance, children €400,000, grandchildren €200,000, and other relatives or third parties €20,000.
Tax rates range from 7% to 50%, depending on the amount inherited and the degree of kinship.
Where to Report Your Crypto
Crypto taxes are filed as part of your annual tax return using the Elster online platform. Both crypto capital gains and losses and crypto Income must be reported inside Annex SO (Other Income) and main form ESt 1 A.
To learn more about declaration obligations and how to declare your crypto assets, see the dedicated article.
Tax and declaration deadlines
In Germany the tax year starts on 01 January and ends on 31 December.
The tax declaration deadline for the 2024 fiscal year in Germany is 31 July, 2025, if you file your tax return independently. However, if you use the assistance of a tax consultant or a certified tax advisor, the deadline is extended to 30 April, 2026. It is important to meet these deadlines to avoid potential penalties or interest charges.