German Draft Bill Imposes New Tax Rules on Cryptocurrency Holdings

The German Federal Ministry of Finance has released a draft bill outlining new tax rules for cryptocurrency holdings. According to the draft, gains from the sale of crypto assets will be taxable regardless of holding period, and will fall under the flat-rate withholding tax as investment income.

However, there is a crucial cut-off date: December 31, 2026. If you acquired or received your cryptocurrencies before this date, they will remain subject to the current one-year holding period rule, where gains are tax-free after a year.

If you purchase or receive cryptocurrencies after January 1, 2027, they will be treated as investment income and subject to withholding tax.