The German Ministry of Finance has published a letter officially confirming that the sale of crypto assets will be tax-free after one year, even if the coins are used for staking and lending.
How crypto profits are taxed in Germany
Germany’s Treasury Ministry announced on Wednesday that it had published a letter on cryptocurrency income taxation, stating:
This is the first time that there is a nationwide uniform administrative instruction on this topic.
The Treasury explained that at a hearing last year, one of the most hotly debated issues was whether the tax-free holding period for crypto lending and staking should be at least 10 years.
The department noted that in coordination with the states:
The letter now states that the so-called 10-year period does not apply to virtual currencies.
In Germany, cryptocurrency is considered “private wealth,” meaning that “it incurs an individual income tax rather than a capital gains tax,” explained crypto tax firm Koinly, stressing that Germany “only taxes crypto if sold within the same year it is sold.” was bought.”
Koinly further detailed:
As a “private sale” in Germany, crypto profits are completely tax-free after a holding period of one year.
“Furthermore, profits from crypto sales remain tax-free up to €600 per calendar year,” the firm added, noting that previously “when it comes to redeeming staked cryptos, that tax-free holding period is at least 10 years.”
Citing the letter released by the Treasury Department, crypto advisor Patrick Hansen stated on Twitter:
The sale of purchased crypto assets remains tax-free after one year, even if used for staking/lending.
Parliamentary State Secretary Katja Hessel: “For private individuals, the sale of purchased bitcoins and ethers is tax-free after one year. The deadline is also not extended to 10 years if, for example, Bitcoin was previously used for lending or the taxpayer provided ether as an insert for someone else.”
What do you think of this German tax law? Let us know in the comment section below.
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