Germany Crypto Tax 2026: The 1-Year Rule That Makes Gains Tax-Free

Germany is one of the most crypto-friendly countries in the EU — if you understand one rule. Hold longer than a year and your gains can be 100% tax-free. Miss the fine print and you can pay up to 45%.

The headline rule: hold >1 year, pay 0%

In Germany, privately held cryptocurrency is treated as a "other asset" under §23 of the Income Tax Act (Einkommensteuergesetz). The key consequence: if you hold a coin for more than 12 months before selling, the capital gain is completely tax-free. No capital gains tax, no income tax.

If you sell within 12 months, the gain is a "private sale transaction" (Privatveräußerungsgeschäft) and is taxed at your personal income tax rate — which can reach roughly 45% (plus solidarity surcharge and, where relevant, church tax).

The trap most people miss: swaps reset the clock

Here is where investors get burned. A crypto-to-crypto swap is a disposal. When you trade BTC for ETH, you have "sold" your BTC (taxable if held <1 year) and "bought" ETH — and the 12-month clock on that new ETH position starts from the swap date, not your original purchase.

Example: Buy BTC in January. Swap BTC→ETH in November (11 months). Sell ETH in February. You did not hold the ETH for a year — so the gain is taxable, even though you were "in crypto" for over 12 months.

Staking, lending and the reward clock

Rewards from staking, lending and mining are taxed as income at their fair market value when you receive them. The 1-year tax-free rule then applies separately to the reward tokens themselves — you must hold each reward for over a year to sell it tax-free later.

Cost basis: FIFO in practice

German tax authorities generally accept FIFO (first-in, first-out) per wallet. Because old coins are the ones most likely to have crossed the 1-year line, FIFO usually works in your favour — the coins you sell first are your oldest, tax-free holdings.

What you must report

• Short-term disposals (held <1 year) with gains over the €1,000 allowance — in the Anlage SO form.
• Staking, lending, mining income — as other income.
• Keep records of every acquisition date, cost, disposal date and proceeds. The clock is per-coin, so dates matter.

Bottom line for German crypto holders

Germany rewards patience. The single most valuable move is simple: track your holding periods and avoid swaps that reset the clock before the 12-month mark. Done right, long-term crypto gains in Germany are genuinely tax-free — a benefit most countries don't offer.