Germany: Crypto held for more than a year will not get taxed

https://www.vanticatrading.com/post/germany-crypto-held-for-more-than-a-year-will-not-get-taxed

by mpyllan • 4 years ago

289 213 4 years ago

mpyllan• 4 years ago

The German Federal Ministry of Finance has published a document defining and framing the different types of cryptocurrency gains.

lern_too_spel2• 4 years ago

"Please don't use HN primarily for promotion. It's ok to post your own stuff occasionally, but the primary use of the site should be for curiosity."

buf• 4 years ago

What are Germany's long-term cap gains rules for normal equities?

davidkuennen4• 4 years ago

Always 25% of your profit at the time you sell your equity. They abolished the tax free long time rule 2009.

aeyes• 4 years ago

26.375%, there is no way to get around the 5.5% solidarity surcharge.

anaisbetts• 4 years ago

Germany doesn't distinguish between long/short term, it's a simple ~25% flat tax no matter what

xioxox2• 4 years ago

I believe there is a tax free threshold of 801€ for singles and 1602€ for couples, however.

Mo37• 4 years ago

This has always been the case.

I've been seeing this spammed all around the internet today. I wonder if there may be some... motivation behind it.

// Edit, for whatever it's worth, I'm CTO at a major hedge fund at NYSE and the CEO literally just sent me the same damn article hosted on a different URL. I pointed out that it has always been the case and he replied with a GIF of a puppeteer.

lxgr3• 4 years ago

It does not apply to stocks, bonds, mutual funds, and most other securities, which I would consider somewhat relevant asset classes.

Mo37• 4 years ago

I stand corrected, that is the way it has been before 2009 when I lived in Germany. I've edited the original comment.

It has, however, always been the case for cryptocurrency. This is not a new tax law or anything of significance.

fock• 4 years ago

maybe because crypto is supposed to be currency ;)

ManuelKiessling• 4 years ago

This is nonsense. E.g. you can sell a house tax-free no earlier than two years after you’ve bought it, and only if you oived in it — if not, you need to wait 10 years for a tax-free sale.

PinguTS• 4 years ago

Funfact, if you move in directly after buying, you can sell it even in the very same year tax-free in the gains.

The two years plus 1 day rule applies only of the curse of 10 years, if you haven't moved in directly.

Mo37• 4 years ago

Real estate is not a traditional asset class.

TacticalCoder2• 4 years ago

Two years if you live in it is not very different from one year. The 10 years for secondary houses is about preventing house shortages I guess. People need to be able to buy or rent a place to live: nobody needs to own cryptos.

informalo4• 4 years ago

That's not true. Before, crypto currencies used for staking and lending were only exempt after at least 10 years of holding. This has changed now.

Mo37• 4 years ago

The title literally says "HELD".

qwertox• 4 years ago

This has changed now.

Where does it say that?

throwaway4good• 4 years ago

Your boss sends you a gif of a puppeteer?

Mo37• 4 years ago

Of course. Yours doesn't?

We’re both executives. Besides, I have to admit that it’s always super funny realizing that we have flatter hierarchies and better work climate at a damn hedge fund than most places.

And we’re not even crooks! Would you believe that. Crazy.

karkisuni• 4 years ago

maybe they have a good relationship with their boss and communicate in ways that work for them and match the world we live in? does your boss still communicate with you in formal memos?

davidkuennen4• 4 years ago

I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here.

seppel• 4 years ago

I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here.

If you buy a car (let's say an oldtimer) and sell it for more money than you bought it after one year, it is also tax free.

Real estate is also tax free after two years (or ten years, depending on whether you have lived in it).

davidkuennen4• 4 years ago

That's true. I stand corrected.

mbeex4• 4 years ago

Real estate is also tax free after two years

Gold one year (and free of VAT, when buying)

pavlov5• 4 years ago

Did you declare the 80k profit on your tax return?

I haven’t lived in Germany, but in the European countries I know, that would qualify as capital gains.

zmb_• 4 years ago

Physical gold is also tax free after a year in Germany.

can16358p2• 4 years ago

To be honest, it is the way it should be. Government taxing crypto is similar to mafia holding a gun and asking you for money.

Good that they didn't go that way (even if only applies to assets held > 1 year)

traveler012• 4 years ago

I get some public services need the tax money to function. But governments nowadays tax people beyond oblivion, specially in Europe.

solarkraft• 4 years ago

You may feel that way about all taxes. But it's weird that crypto currencies are an exception.

p2detar2• 4 years ago

How does this work? Do you declare that you have sold crypto at all, or you just sell after one year without notifying anyone?

davidkuennen4• 4 years ago

The second option. I simply didn't notify anyone and so far no one asked about it. Maybe because the money came from Binance (crypto) they simply didn't bother or something.

Cthulhu_2• 4 years ago

I do some amateur stonks trading and I believe the bank I trade at will withhold some taxes for dividends paid; I presume that the total monetary value of stocks + cash held on January 1st of every year is passed on to the tax office, who will use it for capital gains taxes (iirc it's a percentage of 4% of the amount, that is, they assume you will, on average, be able to get a 4% ROI on investments and tax that return).

This difference between income taxes and possession / investment taxes is why pretty much everywhere in the world, high ranking and high earning people don't pay as much taxes because their earnings will be from stocks and non-wage income. I'm sure there's macro-economic reasons behind it, I dunno.

dathinab3• 4 years ago

was a very strange feeling to receive that completely untaxed,

Well thats the absurdity of the German tax system.

People which do not have much don't pay much taxes (lower %cut).

People who are more wealthy then that pay a lot of taxes (max %cut).

People who are even more wealthy again much less taxes (still max %cut, but docents of ways to circumvent taxes, and "safely" launder money e.g. by going through art collections, buildings etc.).

xioxox2• 4 years ago

It also has crazy things like taxation on energy produced by your solar panels that you use yourself.

svachalek• 4 years ago

It's the same in the US.

Mehringotio• 4 years ago

You will need to pay taxes as you are required to mention this in your tax form.

Otherwise it's just tax fraud.

I would put 20-30k aside to be save.

SZJX8• 4 years ago

Nah. It’s mentioned in multiple places in this thread that crypto, just like any other personal asset, is tax-free after being held for a year. It has always been so. Not sure on what basis you arrived at the conclusion that “You will need to pay taxes as you are required to mention this in your tax form.”

Also see https://www.toytowngermany.com/forum/topic/370675-taxation-o...

SZJX8• 4 years ago

Yeah it’s a pretty surreal feeling especially considering how Germany has an absolutely antiquated system on startup stock options that would simply tax your potential gains to oblivion, which ranks bottom in Europe together with Belgium. See https://www.indexventures.com/rewardingtalent/country-detail... Still considering leaving in the near future because of this and a few other factors (e.g. gloomy winter).

danielfoster• 4 years ago

I think the more important question is, “Can I deduct losses?”

I would assume the answer is no.

krembanan2• 4 years ago

Why is it more important? Anyone would take no tax on gains over loss deduction any day

altdataseller2• 4 years ago

No taxes on gains are more important in a bull market. Loss deduction is more important in a bear market (which crypto is in right now)

informalo4• 4 years ago

No words on this in the document unfortunately

fjfbsufhdvfy2• 4 years ago

This makes no sense. Why should there be less taxes on crypto than on stocks and similar things?

ketzu2• 4 years ago

They are treated like ordinary everyday things, like shoes, pants or silverware, not as investments.

edit edit: I have to reinvestiage again... I messed up twice already in correcting myself

final edit: Until further notice, I stand by the claim that cryptocurrencies are treated as collectibles and other non-everyday assets for tax purposes in germany. The original statement was, however, a wrong oversimplification.

They are not actually "everyday items" as those would be tax free i reselling according to [1] which lists as "everyday items" that are tax free for resale: baby clothes, books or private cars. They list as non "everyday items" that are taxed (to some degree) on gains: Limited sneakers or handbags, rarities and collectables, jewlery, precious metals and antiquities.

[1] https://taxfix.de/steuertipps/ebay-steuern-zahlen-privat-ode...

Cthulhu_2• 4 years ago

Citation needed, I'm 99% confident they're classified as investments worldwide now.

TacticalCoder2• 4 years ago

Depending on the country trading the FOREX can be taxed differently than trading stocks (for example not taxed at all). If crytocurrencies are considered, somehow, currencies (no matter how volatile they are), then it may explain it.

captainmuon• 4 years ago

I get why they would do that, to curb speculation, but it seems backwards to my intuition.

Just converting money back and forth should not be taxable. And if I make an advantageous trade with somebody, and a day later I make a disadvantageous trade, it should be a no-op. If you take it to the extreme, a market maker or an algorithmic trader makes thousands of trades a day, creating liquidity and determining prices, and they would be taxed a lot.

My gut feeling is instead you should tax people who use it as an investment and their long term gains.

lern_too_spel2• 4 years ago

You are taxed on net capital gains, not only on trades that were for a gain.

cyphar• 4 years ago

I don't know if Germany has capital loss discounts, but in Australia at least, a capital loss can be used to offset a gain (or a future gain). So the fact that you can make a capital loss doesn't make taxing profits ridiculous. Forex trading is the most analogous thing to crypto trading, and it is taxed in a very similar way. And algorithmic traders absolutely are required to pay taxes on their profits.

Encouraging people to not hold assets long-term (by making short profits tax-free as you suggest) is not a good idea -- it encourages speculation and speculative bubbles. Most countries treat long-term capital gains more favourably through tax discounts for that reason.

mbeex4• 4 years ago

a capital loss can be used to offset a gain

Same in Germany. It's a bit more complicated, because you can only offset certain asset classes against each other. Most prominently, losses in individual shares cannot be reconciled by gains in ETFs.

Hendrikto3• 4 years ago

The number of trades plays no role in how much taxes you have to pay. Your net gains do. Thus, winnings do in fact get canceled out by losses.

xmx132• 4 years ago

The headline is miss-leading. As a German tax-residency I can give some background.

Already in the existing tax law, crypto held for more than a year didn't get taxed. If you sold within the first year your personal income-tax rate got applied. Which is most likely 45% if you work in any tech-related position.

The only exception was if the coins/tokens were used for staking the tax-free holding period got extended to 10 years.

This has changed now. All crypto held for more than one year will not get taxed.

Technically, it is also not a new tax law. The tax-authorities changed their interpretation, how the existing tax-law should be applied for crypto-holdings.

vmception• 4 years ago

Are there state level and municipal level income taxes as well?

lxgr3• 4 years ago

No.

brazzy3• 4 years ago

Nope. The income taxes are distributed in a fixed ratio, 15% goes to the municipality/county, and 42.5% each to the state and the federal budget.

Aachen3• 4 years ago

There is

- TV tax (also if you don't own a TV),

- pension tax (also if you have ETFs of your own),

- care and health insurance are two things separately deducted before money makes it into your bank account,

- iirc until 2021 eastern germany taxes to help poorer regions,

- church taxes if your parents signed you up for it -- until you pay a fee to get unregistered from the church.

This is all separate from income tax. And of course if you own a car or want to use public transport that's separate still.

Not sure what my landlord pays for waste management, in NL I think you pay separately for that, can't quickly find it for Germany (German Wikipedia about Kommunalabgaben says Abwassergebühren are indeed a municipality or city circle thing, but then two others said you don't pay anything to the municipality so I'm not confident I'm reading this German article correctly).

brazzy3• 4 years ago

your personal income-tax rate got applied. Which is most likely 45% if you work in any tech-related position.

The 45% bracket starts at 277.826 € in 2022. That is definitely not the kind of money people in a "tech-related position" in Germany routinely earn.

luciusdomitius• 4 years ago

99% of techies I know who are also financially literate enough to be stacking sats are in the top 5% bracket income-wise. I know that because I know what sort of offers suggested by me they have rejected. If the 5-th percentile of tech pay in Germany is around that amount, I can't tell.

xmx132• 4 years ago

Yes, you are correct. My fault.

It is 42% if your income is higher than 57.918 Euro (2021). Most tech-related positions will achieve that.

felixge2• 4 years ago

Yup. But that's marginal tax rate. Average tax rate for e.g. 150k EUR income is 37.8%.

See https://www.bmf-steuerrechner.de/ekst/eingabeformekst.xhtml

ars• 4 years ago

The decimal as a thousands separator made me read that as a much smaller number, and I was surprised that Germany calculated tax rates to 3 decimal digits.

For other confused people, read that as: €277,826.

stjohnswarts2• 4 years ago

That doesn't make any sense to me if I'm understanding it correctly. If you buy $100 in bitcoin and sold for $120 then you'd have to pay $54 in taxes? That can't be right unless it's 45% on the $20 extra that you "profited" ?

archi42• 4 years ago

IANAL (but German): I am only aware that you have to pay taxes on gains. I'd be pretty sure (or very much surprised) if you had to pay e.g. $50 in taxes after buying $200 of crypto, losing half of it and then converting the remaining $100 back to cash. So given your example you report $20 gained on the transaction and pay $10 in taxes.

If you've to pay taxes in German and move serious amounts of money (be it stock or crypto): Get a tax accountant and setup some tax avoi... optimization. I feel like our system essentially demands this.

Oh, I'm lazy and always do tax estimates with 50% instead of 45%.

_whiteCaps_• 4 years ago

You've only made an income of $20, so you're only taxed on that.

ramesh31• 4 years ago

The title is absurd and should be changed. You will be taxed eventually. Germany is just classifying Crypto as any other long term capital gains.

fjfbsufhdvfy2• 4 years ago

So it is not tax-free as the title implies, but fixed 25%?

littlecranky675• 4 years ago

This is not true; Crypto as well as gold are not taxed by capital gains ever - they are considered special and treated differently on your tax declaration ("Einnahmen aus Veräusserungsgeschäften"). It just happens that the same tax rate of 25% is applied (if held for less than a tear).

pavlov5• 4 years ago

…Will not get taxed as income but instead as capital gains.

Americans are familiar with this system, it’s how short-term and long-term capital gains work in the USA.

Edit — my misunderstanding, German system is different after all. See asldjajlfkj's reply below.

ben_bai• 4 years ago

German income tax rate is progressive, and maxes out at 45%. While capital gain tax is a flat 25%

pavlov5• 4 years ago

Yes, it’s the same in USA.

(The federal rates are lower, but state and local taxes can push your tax bill up to European levels, especially if you own property in a desirable area.)

edmundsauto• 4 years ago

I think you're probably aware of this, but for non Americans - this is the same as in the US. Except I think the capital gains rate (holdings > 1 year) is 15%?

(America also has progressive income tax that caps out around 40% I believe... any gains from holdings sold < 1 year are "short term capital gains" which is at standard income tax rates)

rcMgD2BwE72F3• 4 years ago

If you're poor and only have your work to sell, you'll get taxed progressively until you're rich enough to save money and invest. Meaning your effective tax rate increases as you get reasonably rich (from work) and then when you're really rich, the rate slowly decreases down to the level of capital gain tax. I don't understand why this is accepted. I find this revolting as I'm in the position to benefit (my tax rate going below that of people far less wealthy than me).

papito• 4 years ago

With all the wining about European socialism, this is what I pay with combined NYC, state, and federal taxes, plus all the deductions for the safety net that the government should provide anyway.

asldjajlfkj• 4 years ago

No. A "Privatverkauf" is tax free after one year. If you sell before that it is taxed as income. Crypto is never taxed as capital gains in Germany.

pavlov5• 4 years ago

Thanks for the clarification! I edited my reply.

I have to say, this blows the mind for Americans who assume European countries are tax hells. The IRS will tax everything, sometimes before you’ve sold it: I had to pay mark-to-market capital gains tax on unrealized gains in a foreign mutual fund I’d bought before moving to USA.

0daystock2• 4 years ago

Same as in the US: MFJ gets to claim up to $83,350 of long-term capital gains without any tax.

stiltzkin• 4 years ago

Best summary so far.

recursive• 4 years ago

American here. Did not know short-term and long-term were different things.

goatcode3• 4 years ago

Another rule benefiting large investment firms and hurting individuals. Nothing surprising here.

Hendrikto3• 4 years ago

What are you talking about? As a German individual, I am very happy with this.

If you trade professionally, you will have to deal with tax implications, but that‘s your job, so it‘s fine.

If you are just a small investor staking some coins, this decreases the burden on you.

How does this benefit big players at the cost of retail investors?

goatcode3• 4 years ago

Whom do you believe has a greater capability to hold anything for a longer period of time: the individual, or the investment firm? And for holding for a short period, and thus having to deal with taxes: again, whom do you believe more capable of dealing with that?

Any regulation is an advantage to large over small, at the right level of large vs. small, since the burden of optimizing to win is more easily borne by the former. In some cases, it's just more obvious.

Erwin• 4 years ago

Interesting to compare that to what happens across the border in Denmark, where crypto is treated as speculation: EVERY individual sale you make has the profit taxed as personal income (calculated as FIFO and so up to ~52%) but the losses have deduction taxed separately at about 26%.

Thus you can end the year with 0 net profit, but a huge tax bill!

randyrand• 4 years ago

governments are really immoral when it comes to crediting losses.

it’s pretty easy to be taxed while losing money, even in the USA.

fareesh• 4 years ago

In India the gains are taxed at 30%. We have a kleptocracy, regardless of who runs the government.

glouwbug• 4 years ago

50% for Canadians, but our NDP wanted to bump it up to 100% so as to "tax the rich". Rich implying you got a maxed out TFSA / RRSP

intabli• 4 years ago

Yet another attack on peer to peer electronic cash, masquerading as a benefit handed over by the amazing thoughtful overlords to their ignorant peasants. Cryptocurrency is CURRENCY, meant to be spent and replaced and worked for, not “Hodl bro” like idiots everywhere tout.

somenameforme• 4 years ago

One interesting aspect of any form of currency that is strictly finite (like most crypto implementations are) is that it will become deflationary over time. Economies, demand, etc will grow but the amount of currency will stay, more or less, the same. So the currency will inherently become worth more.

Good and bad depending on how you look at. As a holder, it's good because your money becomes worth more. But on a macroeconomic level, there's an argument to be made that inflation is good because it basically is a deterrent against 'hodlllll' and a motivator for things like lending and what not, which help the gears of the economy churn. But we're probably going to get to see the endgame of the inflationary fiat game in our lives and I guess we just get to see whether a depressionary crash or an inflationary crash is less awful.

dcolkitt2• 4 years ago

This is common folk wisdom, but not exactly what macroeconomists actually believe. It's true that deflationary shocks tend to lead to hoarding money and economic activity freezing. But long-run deflation that's baked into the system and expected appears to have no impact on economic activity.

We know this from the economic history of the 19th century. The entire period from 1815-1914 was broadly deflationary, yet economic growth rates were significantly higher than the 20th century. There was certainly no shortage of massive investment made into industrialization, railroads, electrification, and fossil fuels among other major endeavors.

https://www.nber.org/digest/apr04/good-versus-bad-deflation-...

jossclimb• 4 years ago

What are capital gains like in Europe / Germany, similar to here in the US?

BlargMcLarg2• 4 years ago

Europe doesn't have universal capital gains tax. In fact, a country might not have a capital gains tax at all.

Germany has a flat 25% from what I can tell.

skizm• 4 years ago

If I hold physical gold bars in my basement for more than a year and sell at a profit, how is that taxed? Should be the same, right?

scrollaway• 4 years ago

Yes, and it is.

G3rn0ti• 4 years ago

Not in Germany. If you hold your gold bars for longer than a year and you sell'em -- no taxes. German capital gains tax applies to stock and derivates (i.e. papers) but not to commodities (physical things like gold, cars or other hardware). So even while cryptos are non-physical they are treated like physical items. And that kind of makes sense if you believe Bitcoin is like digital gold. However, there will be a dispute at some point I guess when it comes to typical government tokens because they resemble very much a stock shares with voting rights.

lxgr3• 4 years ago

Maybe? But now consider "tokenized stocks" (setting the legality of it aside for a moment) – should these be taxed as property instead of investments too?

Archelaos• 4 years ago

The holding period of one year, after which no taxes apply, corresponds to the general tax regulation of foreign currency balances in Germany. In the past, there has been a debate as to whether cryptocurrencies are actually "currencies" in terms of this general tax regulation. It seems that this debate has been saddled for a while now.

However, the tax exemption also has a disadvantage. Losses cannot be offset against other taxes. If your cryptocurrency investment is losing value, you should consider selling it before one year has passed. In such a case, it is also advisable to consult a tax counsellor first, because there might be some pitfalls (a certain period between selling and re-investment might be necessary; problems might arise when an account is older than a year, though the main investment is not; not all losses can be offset against all others, etc.).

Another pitfall is that the foreign currency account must not be interest-bearing. In such a case the holding period of one year is extented to ten years.

leobg2• 4 years ago

Not sure if this has anything to do with currencies. The rule in question applies to any sale of an asset in the private domain (“Privatverkauf”). It is the same rule that would apply to reselling a house or a car or a washing machine. This is in contrast to capital gains, which are being taxed according to different rules, and where there is no such 1-year deadline. Capital gains are profits from the selling of stock, and also interest on money in your bank account. So essentially, the way the rules are being applied to cryptocurrency is simply telling us that cryptocurrency isn’t being recognized as any special form of capital, and is instead treated no different than a washing machine or a coin collection.

bombcar• 4 years ago

Which is very interested because now there's a "demand" for crypto currencies that are fixed to ... SPY say, or VTI.

I wonder how long it would take the Germans to work that trick out and come down hard.

I also wonder how tiny a crypto currency could be ...

dathinab3• 4 years ago

Note that as far as I know this only applies to private buying and selling, if that is the case people which frequently buy and sell crypto also have to be careful that their doing is not classified as commercial.

E.g. there are similar rules for privately selling art (through it's I thing noticeable longer then 1y) and there had been cases where people where not careful enough and it was classified as commercial activity.

zzzbra2• 4 years ago

On the face of it this would seem to create further disincentives to use crypto for its intended purpose.

arcticbull3• 4 years ago

The intended purpose is to move real human money from late entrants to early entrants. This helps further the intended purpose.

jkepler• 4 years ago

Can you provide a source for your statement? Nothing in the Satoshi white paper says that was the purpose, and Satoshi wasn't even sure if the project would work as digital cash, much less enable wealth transfers.

zzzbra2• 4 years ago

lol I meant its supposed purpose

sunshinerag• 4 years ago

What happens if the coins were acquired in a different tax jurisdiction but disposed in Germany?

codethief3• 4 years ago

I would assume it doesn't matter where they were bought. If you sell crypto while falling under German tax law (due to residency etc.), the cited article 23 of the income tax law will apply.

Gustomaximus• 4 years ago

I assume they have rules around how you acquire, otherwise ask your company to make you a contractor so you work for $1 but have the right to buy $XXXX of crypto every month for another $1.

If you have the savings to live a year + happy with the risk you could be income tax free?

agentultra• 4 years ago

Additionally, Germany has 1,430 Bitcoin nodes, representing 9.08% of the total global nodes, putting it in second place in nodes held just behind the United States and ahead of France, with only 3.35%.

This doesn't sound like something Germany should be proud of. Haven't they been shutting down their nuclear plants and relying on/expanding coal usage to keep up with demands (while slowly trying to replace supply with alternatives)?

One study found that the nuclear phase-out caused $12 billion in social costs per year, primarily due to increases in mortality due to exposure to pollution from fossil fuels. [0]

And it's reliance on Russia for gas and coal... it seems like Bitcoin mining is something they ought to be discouraging.

What's the reasoning behind a move like this?

[0] https://en.wikipedia.org/wiki/Energy_in_Germany

BitwiseFool• 4 years ago

Bitcoin Nodes are often simple computers. You can run your own node on cheap commodity hardware and they are not particularly resource intensive. The main concern with these machines is drive space.

Bitcoin miners are the big energy consumers. Nodes help validate the network but they do not perform the intensive proof of work calculations.

bubersson• 4 years ago

You can run a node on your phone... Node is a different thing from a miner.

abxytg2• 4 years ago

One day we'll have the conversation about how the anti-crypto conversation is mostly gross groupthink and at least two or three struggling devrel influencers are now anti-crypto media darlings. If you're going to push an agenda at least make it one that wasn't handed to you shrink wrapped.

mlyle2• 4 years ago

?? If one isn't all-in on cryptocurrency, it only must be because they're influenced by anti-crypto shills?

I've been thinking about digital money for 25 years. I have an early proof-of-work patent. I very much think for myself.

I really don't like proof-of-work for ledgers: they're resource intensive and wasteful. I don't really like abrogating the power of states and central banks to mint unbacked currency to various coalitions. And this looks like a scary, poorly regulated asset bubble that may pop with rather extreme effects.

whiteboardr• 4 years ago

Isn’t this incentivizing “investing” into something much more volatile and risky than stocks from which profits always are taxed at 25%?

Even if there haven’t been taxes on this yet, making crypto “more attractive” than stocks sounds like rallying all greater fools there are to create even more defaults - which in return will hurt society as a whole.

fweimer• 4 years ago

Primary source: https://www.bundesfinanzministerium.de/Content/DE/Downloads/...

There are several caveats with this. First of all, this comes from the treasury (executive branch). There is considerable room for interpretation, and courts may apply existing laws differently than the treasury intends.

Furthermore, according to the letter, the tax-free period only applies to currency tokens (which are defined as tokens to be used for payment purposes). The tokens that routinely make the news do not seem to be in that category. Other tokens may be taxed differently. Here's an example: if someone algorithmically pegs the value of a token to some stock index, it is very likely that you still have to pay the usual 25% capital gains tax once you sell it. Undoubtedly someone will set up a coin like that and take fees in anticipation of tax savings, but this will work out only for some time, until the tax office catches up—or not at all, if the token is never classified as a payment/currency token in the first place.

k__• 4 years ago

Only for privat investors.

If you got paid in crypto, you will get taxed.

And the feds try everything to link crypto you got to some service you provided for it, even if it's just a retweet.

MrYellowP• 4 years ago

Hasn't this always been the case? In Austria that was the norm until the government changed the laws this year. I've assumed in Germany they also had a "SpekulationsSteuer" (a tax of which they've pretended that it helped against rich speculators, which of course it didn't, because that's nonsense).

Germany: Crypto held for more than a year will not get taxed

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