Germany's one-year rule for crypto: how it works, and the plan to end it
Private crypto sales in Germany are tax-free after a year. Here is how the clock, staking and records work, and where the 2027 reform stands.
If you hold crypto privately in Germany, or advise people who do, the tax result turns almost entirely on dates: a sale more than a year after purchase is generally tax-free, a sale inside the year is not. The finance ministry's March 2025 guidance tells you how to prove those dates, and a draft law published in September 2026 would remove the exemption for coins bought from 2027.
The basic rule
Section 23 of the Income Tax Act (EStG) taxes private sales of assets other than land only where no more than one year passes between acquisition and sale [1]. The Federal Ministry of Finance (BMF) treats crypto as such an asset, citing a 2023 Federal Fiscal Court ruling, so private crypto gains fall under this regime [2].
Three features matter in practice. First, the €1,000 limit is a threshold, not an allowance: gains stay tax-free only if total private sale gains for the year are under €1,000 (it was €600 up to 2023), and once you cross it the whole amount is taxable [1][2]. Second, losses from these sales can only be set against gains from the same kind of sale, though they can be carried back or forward under the general loss rules [1]. Third, the statute allows a ten-year period for assets used to earn income, but the BMF says that extension does not apply to currency or payment tokens [1][2].
The one-year rule is for private assets. Where crypto is business property, sale proceeds are business receipts and the cost of the coins sold is deducted, with no holding-period exemption, and the BMF warns that frequent buying and selling can itself amount to a trade [2].
When the clock starts and restarts
Every swap is a sale. Exchanging one token for another, or for euros, goods or services, disposes of the token given up, and the one-year period starts again for whatever you receive [2]. For a crypto-to-crypto swap, the proceeds are the market value of the token received; if that cannot be found, using the value of the token given up is accepted [2]. The value of the token given up, plus any acquisition costs, becomes the cost of the new token, and transaction fees on the sale are deductible expenses [2].
Timestamps come from the exchange's records for trades on a central platform. For direct trades, including on decentralized exchanges, the wallet's timestamps are normally used [2].
Which coins did you sell?
The starting point is specific identification. Where that is not possible, the BMF says the earliest coins of a given token are treated as sold first for the holding period, and the gain is measured at average cost; as a simplification, FIFO may also be used for the gain [2]. The method is chosen wallet by wallet and token by token, and must be kept until that wallet's balance of the token has been fully sold [2]. Keep a note of the method used for each wallet, because the BMF lists it among the records an office may ask for [2].
| Event | Treatment | Where in the letter |
|---|---|---|
| Sale for euros, or swap for another token | Disposal; taxable only if within one year | Rn. 53–55, 58 |
| Crypto spent on goods or services | Disposal at the agreed euro price, or market value | Rn. 60 |
| Staking or lending reward | Other income at market value on receipt; €256 threshold | Rn. 45, 48, 65 |
| Hard fork | No income; cost split across old and new coins | Rn. 67–68 |
| Transfer between own wallets | No sale; keep records to show it | Rn. 103–104 |
Staking and lending rewards
For a private holder, rewards from passive staking and from lending are taxed as other income under section 22 no. 3 EStG, valued at the market price when received [2]. Income of this kind is not taxed if, together with other such income, it is under €256 for the year [2]. As a simplification, rewards can be treated as received when claimed into the wallet, but unclaimed rewards must be counted by year end at the latest [2]. Rewards are themselves acquisitions, so a later sale starts its own one-year clock [2].
Prices and records
Market value can be taken from a trading platform or a web-based price list [2]. Instead of the exact time of each trade, a documented daily price (daily average, a fixed time of day, or the day's close) is accepted for now, provided it is used consistently; taking costs from the highest source and proceeds from the lowest is the example the BMF gives of inconsistency [2].
For each sale, records should show the token, quantity, cost, proceeds, the dates and prices of the purchase and sale, and the holding period; for lending, the start, end, asset, fee and terms [2]. The tax office may ask for wallet addresses, transaction hashes and balances at 31 December, and if it cannot work out the figures it must estimate them [2]. Platform tax reports can be accepted if they look complete and internally consistent, but the office may ask for the underlying CSV files [2]. Very high earners have a six-year retention duty [2].
The letter applies to all open cases; older pricing approaches and records that differ from the new requirements are not challenged for tax years up to and including 2024 [2].
The reform: draft, not law
On 30 September 2026 the BMF sent a draft law into consultation between ministries that would move private crypto income into the capital income regime and drop the one-year exemption [3]. A law firm's summary of the draft describes a 25% flat rate plus solidarity surcharge for coins acquired after 31 December 2026, with older holdings keeping the current rule, and withholding by crypto service providers from 2028 [4]. According to press reports, the cabinet did not take up the draft on 14 October 2026; the ministry said internal coordination was still under way, and the bill would still need to pass both chambers of parliament [5]. As of mid-October 2026 the one-year rule is unchanged.
What to do
- Record acquisition dates per wallet and per token, and keep the method you chose (specific identification, average or FIFO) in writing.
- Treat every swap as a sale that resets the clock, and price both legs from one consistent source.
- Track staking and lending rewards at receipt value, and count them toward the €256 threshold.
- Export exchange histories and keep wallet addresses and transaction hashes, ready for a tax-office request.
- Watch the reform: if it passes as drafted, separate holdings bought before and after 1 January 2027.
Sources
- Einkommensteuergesetz (EStG) § 23 Private Veräußerungsgeschäfte (Federal Ministry of Justice (gesetze-im-internet.de))
- Einzelfragen zur ertragsteuerrechtlichen Behandlung bestimmter Kryptowerte (BMF letter of 6 March 2025, IV C 1 - S 2256/00042/064/043) (Bundesministerium der Finanzen (copy hosted by Deubner Verlag))
- BMF: Entwurf eines Gesetzes zur Reform der Besteuerung bestimmter Kryptowerte im Privatvermögen (PwC Germany)
- Krypto-Besteuerung ab 2027: Was der Referentenentwurf zur Abgeltungsteuer konkret vorsieht (Ruge Fehsenfeld)
- Krypto-Haltefrist: Kabinettstermin ohne Beschluss (CryptoTicker)
General information for finance teams, current as of publication. Not legal, tax or accounting advice.