In Germany, capital gains from cryptocurrencies held for over a year are not subject to any taxation.
For cases where capital gains are generated from assets held for less than a year, the cashout method used is FIFO (first in, first out).
This means that the asset sold will be the first one acquired in chronological order.
Additionally, a "wallet-by-wallet" analysis is required to determine the sequence of the units sold.
Example of How FIFO Works:
User A buys 0.5 ETH on March 12, 2023, at a cost of €700 (ETH price €1,400).
User A buys 0.5 ETH on February 1, 2024, at a cost of €1,000 (ETH price €2,000).
User A buys 1 ETH on April 7, 2024, at a cost of €1,600 (ETH price €1,600).
User A sells 1.5 ETH on June 3, 2024, at a price of €2,700 (ETH price €1,800).
Calculation of Gains/Losses:
(1,5 - 0,5) * 1800 = 1800
[1800 - (0,5 * 2000 + 0,5 * 1600)] = 800
In the first calculation line, the non-taxable amount of ETH is subtracted from the total sold because it was acquired more than a year before the sale, thus obtaining the taxable amount on which to calculate the capital gains.
If non-deductible losses are generated due to the absence of gains in the same fiscal year, these losses can be carried forward to subsequent years and used to offset any future capital gains.