Germany's New Crypto Tax Rules: What You Need to Know

Crypto investors in Germany must declare their gains and losses on their tax return, according to recent guidelines from the Federal Ministry of Finance. This includes sales within a year that total more than €1,000, swaps of one cryptocurrency for another, and staking or lending income above €256 per year.

If an investor held onto a cryptocurrency for over a year before selling, they do not need to declare the gain as it is tax-free. Losses from sales within a year can be offset against future gains, but only if declared on the tax return.

The tax office expects investors to keep records of every transaction and calculate their holdings period accurately. Failure to declare taxable transactions risks tax evasion under Section 370 of the German Fiscal Code, with a ten-year limitation period.