Taxation on crypto currencies - please read before asking

[karmakoma 57]

Can someone collaborate? Or at least explain if the rules are changed in the meantime?? Thank you!!

[kapil354 94]

From what I understood

 

Holding for more than 12 months

1. Sales of crypto not taxable IF sold after 12 months of holding.

-------------

Holding less then 12 months (traders)

2. If sold before that - then up to 600 EUR profit - there is no tax

3. However, if profit is even one Euro more than 600 - then whole amount is taxed

[JustAskDima 7]

hi Crypto Experts,

How do go about paying taxes on a bot trading cryptocurrencies on my behalf?

The bot can make 1000's of automatic transactions per month, how can I submit this much information to Finanzamt?

Or do I pay the profit for the capital gains only?

thanks in advance!

[kapil354 94]

On 1/19/2021, 12:55:58, JustAskDima said:

hi Crypto Experts,

How do go about paying taxes on a bot trading cryptocurrencies on my behalf?

The bot can make 1000's of automatic transactions per month, how can I submit this much information to Finanzamt?

Or do I pay the profit for the capital gains only?

thanks in advance!

Dima was wondering if these algo trading platforms are any good? Would love to get some guidance here... 

[Sumarokov-Elston 9]

I have a similar question to "aguy" in the previous page.

 

I happened to buy Bitcoin back in 2013 by sending fiat to an exchange (Kraken) and then transferring the crypto into my wallet.

 

Since then, I have done nothing with it as I am not interested in trading. However, it has since been suggested that I would not pay any tax while I am a tax resident in Germany if I converted it back to fiat (EUR) now.

 

Quick check: the fact that I bought it when I was NOT a tax resident of Germany (2013) does not alter this?

 

[I can prove that I funded the money to the Kraken exchange, as they provide a way to "export your transaction history", although it is a rather feeble and, to my mind, dubious-looking excel file that provides no real detail at all, i.e. it looks like something a child could print out at home.]

 

Second part of question. I am not actually interested in selling my crypto for fiat, but I have been looking into depositing it with Bitwala, who offer interest and, also good, a non-custodial wallet.

 

I get completely that I should pay tax on interest and I believe that Bitwala offers a service which calculates all you need for submitting any tax return.

 

All that is fine. But what if you withdraw a bit of cash through an ATM using their debit card (after selling crypto for fiat)? Would you need to specially provide all the information to the tax authorities so they do not come chasing after you, because otherwise who is to say that you really have owned this crypto for more than a year? Also... what if you have both? Crypto since 2013 and some you bought last week. If you withdraw cash today, how do you decided FROM WHICH crypto you have cashed out, i.e. taxable or not taxable?

 

[Shanks008 4]

I have a simple question on tax declaration for Cryptos. I am a German Tax resident. 

 

I understand clearly that if you buy and hold a Bitcoin for 12 months  and sell it AFTER 12 months there are no taxes on the same. Assuming I don't do anything with the coin except lock it in a wallet and sell it after 12 months .

 

My question is do I even have to bother telling the Finanzamt that Yes, I did buy a coin in January 2020 and I sold it in Feb  2021( After 12 months) and well I did make a Euro 10K gain on the same.

 

....or there is absolutely no need to mention anything at all as  profits were booked only after 12 months?

 

 

[kapil354 94]

22 hours ago, Shanks008 said:

I have a simple question on tax declaration for Cryptos. I am a German Tax resident. 

 

I understand clearly that if you buy and hold a Bitcoin for 12 months  and sell it AFTER 12 months there are no taxes on the same. Assuming I don't do anything with the coin except lock it in a wallet and sell it after 12 months .

 

My question is do I even have to bother telling the Finanzamt that Yes, I did buy a coin in January 2020 and I sold it in Feb  2021( After 12 months) and well I did make a Euro 10K gain on the same.

 

...or there is absolutely no need to mention anything at all as  profits were booked only after 12 months?

 

 

there is no need to mention if it is more than 12 months

[Shanks008 4]

On 2/25/2021, 10:24:54, kapil354 said:

there is no need to mention if it is more than 12 months

 

Thanks Kapil354. I will convey this to my Steuerberater who is surprised that Germany doesn't tax crypto gains made after 1 year:-). 

 

Do you know if there is any written statement to this effect from the Finanzamt that I can show my Stuerberater ? like a para describing rules connected to the same?

[TurMech 148]

On 27.2.2021, 10:36:01, Shanks008 said:

Do you know if there is any written statement to this effect from the Finanzamt that I can show my Stuerberater ?

 

Send him this link --> https://youtu.be/kHEjGku-ai8

[Shanks008 4]

9 hours ago, TurMech said:

 

Send him this link --> https://youtu.be/kHEjGku-ai8

 

Thanks TurMech. This is really helpful. Let me see which direction this goes.

[JustAskDima 7]

On 21/01/2021, 12:19:12, kapil354 said:

Dima was wondering if these algo trading platforms are any good? Would love to get some guidance here... 

yes, you can make from 0.01% to 10% daily gain. RevenueBot is the easiest to use, plenty of alternatives too.

They only problem they make 100's of transactions per day so you need CoinTracking account for your tax report.

[notfromhere 8]

A little bit off topic, but does anyone know of any banks/institutes that offer loans against Bitcoins?

 

I think something like „Lombardkredit“ in German. I contacted Augsburger Aktienbank but they were pretty futile

[veinar 0]

I have somewhat unusual situation regarding my crypto holdings.

I bought some BTC and ETH via Coinbase website couple of years ago while I was living and being a tax resident in USA.

I converted immediately these to some other cryptos, which are not able to be converted back to fiat directly.

Now, I live and work in Germany.

Since Germany offers 0% tax on long-term holdings, it would make sense to cash-out here, which should be perfectly legal as I am a resident in Germany.

I see that you do not need to even report to Finanzamt when you sell your long term holdings. There is even a video above that would probably provide me with better understanding on how that works, but sadly my Germany is not yet that advanced.

But let's say Finanzamt would like to know where I got that money from.

What I could offer them is a receipt from Coinbase back when I initially bought BTC and ETH. I anyways need to convert my alt-coins to any of these 2 major Cryptos in order to cash out to fiat. So in my mind, that should be a sufficient enough proof. Or maybe I am wrong?

Another thing is that, let's say I bought X BTC and Y ETH. I converted them to these alt-coins, and they did really good, even better than BTC/ETH in the past few years (Of course, this is hypothetical and not the case at the moment, but that doesn't mean that it cannot be applicable in future if I hold long enough). So then I would again need to convert back to BTC/ETH, but I would have amounts more than X BTC and more than Y ETH. So then I would have a mismatch in my "proof" of how much BTC/ETH I initially bought , and how much I sold in the end. For this scenario, the only way to possibly prove that it was all part of the same investment, would be to present to Finanzamt all my crypto-to-crypto transactions/conversions. Is that something that make sense or Finanzamt does not deal with that kind of stuff ?

 

I appreciate opinion of anyone who has, even a slight, knowledge about crypto taxation in Germany.