Crypto Tax Guide Germany 2025
Germany boasts one of the most robust systems in the world for regulating and taxing cryptocurrency while remaining relatively friendly to investors. This guide offers an overview of how crypto is taxed in Germany, including notable allowances, taxable events, reporting requirements, and strategies to position yourself effectively to reduce your tax liability.
📌 Intro
Regulatory Authority
The Bundeszentralamt für Steuern (BZSt) oversees all taxation in Germany, including crypto. Taxpayers report their crypto-related income and gains through the annual income tax return (Einkommensteuererklärung) using the ELSTER portal.
It’s important to keep in mind:
EU crypto exchanges report to tax authorities under the EU’s DAC-8 directive.
BZSt uses advanced tools to monitor crypto activities.
Classification of Crypto
In Germany, cryptocurrencies are classified as private assets (Privatvermögen), not legal tender. This means crypto profits are taxed according to the rules governing private sales transactions (Veräußerungsgeschäfte).
Applicable Taxes
Income Tax (Einkommensteuer): Income from activities like mining, staking, and claiming airdrops.
Capital Gains Tax: Only short-term gains (assets held for less than 1 year) are taxed in Germany. Long-term gains incur 0 capital gains tax.
📅 Reporting and Deadlines
Tax Year: January 1 – December 31.
Filing Deadline: July 31 of the following year (e.g., the deadline for the 2024 tax year is July 31, 2025).
Forms: Use the main tax form (ESt 1 A) and the supplementary form Anlage SO for private sales.
💼 Crypto Tax Basics
Taxable Transactions
On assets held less than a full year, the following crypto-related activities are taxable as in Germany as capital gains:
Selling crypto for fiat currency
Swapping one token for another
Using crypto to purchase goods or services
Transactions that incur income tax include:
Earning crypto through mining
Claiming staking rewards
Receiving airdrops
Receiving crypto as payment for services
Non-Taxable Transactions
Certain crypto activities are not taxable:
Holding crypto for more than one year before selling or using it
Transferring crypto between your own wallets
Receiving crypto gifts within specific exemption thresholds
Deducting Crypto Losses
Losses incurred on crypto trades can be used to offset gains.
Losses can be carried forward if reported.
Key Allowances and Thresholds
Annual Exemption for Private Sales: Gains from private sales transactions are tax-free if the total profit does not exceed €1000 in a calendar year.
Income Tax-Free Allowance: For 2025, income up to €12,084 is tax-free.
Additional Income Threshold: Income from activities like mining or staking is tax-free if it does not exceed €256 annually.
💸 Income Tax Brackets in Germany (2025)
Income tax in Germany is progressive:
Income Range | Tax Rate |
Up to €12,084 | 0% |
€12,085 – €17,430 | 14% – 24% |
€17,431 – €68,430 | 24% – 42% |
€68,431 – €277,825 | 42% |
Over €277,825 | 45% |
Additionally, a solidarity surcharge of 5.5% applies to the income tax amount if it exceeds €18,130.
📈 Capital Gains Tax on Cryptocurrency
In Germany, crypto is treated as private assets under §23 EStG (Private Sales Transactions), meaning gains can be subject to income tax depending on holding period and amount. If the holding period is less than one year, gains are taxable under income tax provisions.
Taxable Events
Selling or swapping crypto held for less than one year.
Using crypto to pay for goods or services within one year.
Exemptions
Holding Period Exemption: If you hold crypto for more than one year before selling or using it, the gains are tax-free.
Annual Exemption: Total gains from private sales transactions are tax-free if they do not exceed €1000 in a calendar year.
Calculation Method
Find the net proceeds (purchase price - sale price).
Subtract any related expenses (gas fees, transaction fees, etc).
Apply any relevant annual exemption (see below).
Apply your personal income tax rate to the taxable gain.
💰 Income Tax on Cryptocurrency
Taxable Income
Crypto-related income subject to taxation includes:
Mining rewards
Staking rewards
Airdrops received in exchange for services or data
Crypto received as payment for goods or services
Interest from lending crypto assets.
Calculation Method
Determine the fair market value of the crypto received at the time of acquisition.
Subtract any related expenses (e.g., electricity costs for mining).
Apply the €256 exemption for additional income if applicable.
Apply your personal income tax rate to the taxable income.
Reporting Requirements
Forms: Report income on the main tax form (ESt 1 A) and the supplementary form Anlage SO.
Filing Deadline: July 31 of the following year.
🔍 Tax Treatment of Specific Crypto Transactions
Mining and Staking
Mining: Income from mining is taxable as other income.
Staking: Rewards from staking are taxable as other income.
Exemption: If total additional income from these activities does not exceed €256 annually, it is tax-free.
Airdrops and Hard Forks
Airdrops: Taxable if received in exchange for services or data.
Non-actionable airdrops are not taxable (e.g. if you didn’t have to claim the tokens, they were just sent to you unsolicited).
Hard Forks: New coins received from a hard fork are not taxable upon receipt but may be taxable upon sale.
Non-Fungible Tokens (NFTs)
NFTs are taxed in a similar manner to regular crypto tokens:
Flippers: NFT sales are taxable if they were held for less than a full year.
Collectors: Proceeds on NFTs held for more than a full year are not taxable.
Creators: Any income earned from creating and selling NFTs is taxable.
Decentralized Finance (DeFi)
LP Token Transactions: Gains from trading liquidity pool tokens are taxable if held for less than 1 year.
Non-LP Token Transactions: New tokens earned from DeFi (lending, staking, yield farming) are taxed as income
Exemptions: If you earned less than €256 cumulatively from DeFi income, it is tax-free.
Lost or Stolen Crypto
Reportable if you provide sufficient evidence (wallet address, cost basis, transaction history).
Losses from collapsed exchanges (FTX, Celsius) are claimable after bankruptcy completion.
Gifting and Inheritance
Gifts: Tax-free up to €20,000 (friends), €500,000 (spouses). Resets every 10 years.
Inheritance: Subject to inheritance tax, with exemptions depending on the relationship between the deceased and the heir.
Germany Crypto Tax Forms: What You Need to File
Reporting crypto taxes in Germany requires the correct tax forms filed with your annual income tax return (Einkommensteuererklärung).
Core Tax Forms for Crypto
Mantelbogen (ESt 1 A): The main income tax form for individuals. All crypto-related gains or income must ultimately flow into this return.
Anlage SO (Sonstige Einkünfte / “Other Income”): This is where most private crypto transactions are reported. Disposals of crypto within 1 year of acquisition are entered here as “other income” under §23 EStG.
Less Common Crypto Tax Forms Include
Anlage KAP (Capital Income): Only required if crypto is held through certain financial products that generate capital income. Direct disposals of crypto normally go in Anlage SO, not Anlage KAP.
Anlage S (Self-Employment Income): If your crypto activity qualifies as a commercial business (e.g., professional trading, mining as a business), then profits must be declared here. Related expenses can be deducted.
Anlage G (Business Income): If crypto mining or staking is structured as a Gewerbebetrieb (business), report net profits here.
Anlage Vorsorgeaufwand: Use if claiming deductions related to insurance or retirement while also declaring crypto business income.
🧾 Using Crypto Tax Software
Reporting taxes on crypto profits can be overwhelming. For most users, utilizing crypto tax software like Awaken Tax is an affordable way to make the process easy. Awaken:
Tracks transactions across multiple wallets and exchanges.
Automatically classifies and categorizes short-term vs. long-term capital gains, income, expenses, and more.
Calculates gains and losses automatically.
Generates tax reports compatible with German tax forms.
And if you ever need help with using our software or reporting taxes on your crypto profits in general, we’re always here to help!
Reducing Crypto Taxes Legally
A few simple tricks to reduce your crypto tax bill in Germany:
Hold assets over one year.
Use exemption limits (€1000 short-term gains, €256 additional income).
Harvest and offset losses.
Gift crypto strategically.
Deduct relevant expenses (transaction fees, electricity, software costs).
Please click here for a full guide on reducing your taxes on crypto profits.
✅ Conclusion
Germany offers favorable tax treatment for long-term crypto holders, with gains tax-free after one year. However, short-term gains and income from crypto activities are taxable. Maintaining accurate records and understanding your tax obligations are crucial. Consider consulting a tax professional for personalized advice.
Related Reading
Bitcoin Runes and Ordinals Tax Guide (2025)
Global Crypto Tax Guide: How Crypto is Taxed All Around The World
