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I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everythin

I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here.

seppel 4y ago
> I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here. If you buy a car (let's say an oldtimer) and sell it for more money than you bought it after one year, it is also tax free. Real estate is also tax free after two years (or ten years, depending on whether you have lived in it).
- davidkuennen 4y ago
  That's true. I stand corrected.
- mbeex 4y ago
  > Real estate is also tax free after two years Gold one year (and free of VAT, when buying)
- pavlov 4y ago
  Did you declare the 80k profit on your tax return? I haven’t lived in Germany, but in the European countries I know, that would qualify as capital gains.
  - SZJX 4y ago
    Seems that it’s treated as “personal asset” in Germany just like a car, thus not capital gains at all like stocks, which would always be taxed at 25%.
zmb_ 4y ago
Physical gold is also tax free after a year in Germany.
can16358p 4y ago
To be honest, it is the way it should be. Government taxing crypto is similar to mafia holding a gun and asking you for money. Good that they didn't go that way (even if only applies to assets held > 1 year)
- traveler01 4y ago
  I get some public services need the tax money to function. But governments nowadays tax people beyond oblivion, specially in Europe.
  - speedgoose 4y ago
    The average European has a good quality of life though.
    - seibelj 4y ago
      Yeah it’s crazy why anyone emigrates from Europe to the US
      - chii 4y ago
        it's hard to get high wages in europe compared to america. So it makes sense to work in america for a while, save and invest, and eventually come back to europe to retire or live a more leisurely lifestyle.
        seibelj 4y ago
        But their lifestyle is so much worse the moment they step foot in America
        bowsamic 4y ago
        mrep 4y ago
p2detar 4y ago
How does this work? Do you declare that you have sold crypto at all, or you just sell after one year without notifying anyone?
- davidkuennen 4y ago
  The second option. I simply didn't notify anyone and so far no one asked about it. Maybe because the money came from Binance (crypto) they simply didn't bother or something.
  - dewey 4y ago
    > I simply didn't notify anyone and so far no one asked about it. That's not really how it works though. You are not supposed to wait for them to ask you about it, you declare it truthfully and otherwise it's tax evasion. Not sure if that applies for your case but that's how these kind of taxes usually work.
    - Aachen 4y ago
      Sounds like GP basically walked out of a shop with goods in their bag and is now posting online how happily surprised they are it was free for a change. Yeah, if you don't go to the register then you don't pay. Until the day someone finds out.
      - samatman 4y ago
        Chewing bubblegum isn't a taxable event so I don't tell the IRS when I do it. Or giving my friend a drone for his birthday, if you prefer something closer to the topic. If selling ETH after holding it for a year isn't a taxable event in Germany, and it sounds very much like it isn't, on what basis should this be reported to the tax authorities?
        p2detar 4y ago
        Actually, my not up-to-date info is that one is pretty much always required to declare the winnings of crypto sales in their Lohnsteuererklärung. Winnings below 600EUR or winnings for crypto assets sold after 1 year of possession are tax free. I have some crypto that I bought last year and some that I bought many years ago that don't have any transactions records for and now I'm lost at how to properly declare a sale. Honestly, the complexity of this is stopping me from doing more crypto trading.
Cthulhu_ 4y ago
I do some amateur stonks trading and I believe the bank I trade at will withhold some taxes for dividends paid; I presume that the total monetary value of stocks + cash held on January 1st of every year is passed on to the tax office, who will use it for capital gains taxes (iirc it's a percentage of 4% of the amount, that is, they assume you will, on average, be able to get a 4% ROI on investments and tax that return). This difference between income taxes and possession / investment taxes is why pretty much everywhere in the world, high ranking and high earning people don't pay as much taxes because their earnings will be from stocks and non-wage income. I'm sure there's macro-economic reasons behind it, I dunno.
dathinab 4y ago
> was a very strange feeling to receive that completely untaxed, Well thats the absurdity of the German tax system. People which do not have much don't pay much taxes (lower %cut). People who are more wealthy then that pay a lot of taxes (max %cut). People who are even more wealthy again much less taxes (still max %cut, but docents of ways to circumvent taxes, and "safely" launder money e.g. by going through art collections, buildings etc.).
- xioxox 4y ago
  It also has crazy things like taxation on energy produced by your solar panels that you use yourself.
  - dathinab 4y ago
    It has taxation on energy usage independent of source. Given that traditionally alternate sources where things like companies having their own small gas power plant or similar this isn't really crazy. (Some details you can skip: The law effectively was about preventing circumvention of taxes on wasting energy, preventing unhealthy fragmentation in the power grid, making stabilizing the power grid easier and helping/subventing electric companies which back then often where state owned, i.e. tax payer financed; The law somewhat made sense for this goals, in the past. But only in the past. Change in technology and the ecosystem make it IMHO sub-optimal today. Today we probably should push for interconnected micro-grids with some decentralized energy sources each.) Today the law is stuck in the past and should be changed IMHO. At least an exception for green decentralized energy and/or excluding (only) small producers should be done, maybe more. Thinking about it currently is the best political weather for it.
- svachalek 4y ago
  It's the same in the US.
Mehringotio 4y ago
You will need to pay taxes as you are required to mention this in your tax form. Otherwise it's just tax fraud. I would put 20-30k aside to be save.
- SZJX 4y ago
  Nah. It’s mentioned in multiple places in this thread that crypto, just like any other personal asset, is tax-free after being held for a year. It has always been so. Not sure on what basis you arrived at the conclusion that “You will need to pay taxes as you are required to mention this in your tax form.” Also see https://www.toytowngermany.com/forum/topic/370675-taxation-on-crypto-currencies/ https://www.toytowngermany.com/forum/topic/370675-taxation-o...
SZJX 4y ago
Yeah it’s a pretty surreal feeling especially considering how Germany has an absolutely antiquated system on startup stock options that would simply tax your potential gains to oblivion, which ranks bottom in Europe together with Belgium. See https://www.indexventures.com/rewardingtalent/country-detail-tables-germany https://www.indexventures.com/rewardingtalent/country-detail... Still considering leaving in the near future because of this and a few other factors (e.g. gloomy winter).

I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here.

seppel 4y ago

> I'm from Germany and sold my ETH at the peak some time ago with a profit of ~80k. It was a very strange feeling to receive that completely untaxed, as everything else is taxed here. If you buy a car (let's say an oldtimer) and sell it for more money than you bought it after one year, it is also tax free. Real estate is also tax free after two years (or ten years, depending on whether you have lived in it).

davidkuennen 4y ago
That's true. I stand corrected.
mbeex 4y ago
> Real estate is also tax free after two years Gold one year (and free of VAT, when buying)
pavlov 4y ago
Did you declare the 80k profit on your tax return? I haven’t lived in Germany, but in the European countries I know, that would qualify as capital gains.
- SZJX 4y ago
  Seems that it’s treated as “personal asset” in Germany just like a car, thus not capital gains at all like stocks, which would always be taxed at 25%.

zmb_ 4y ago

Physical gold is also tax free after a year in Germany.

can16358p 4y ago

To be honest, it is the way it should be. Government taxing crypto is similar to mafia holding a gun and asking you for money. Good that they didn't go that way (even if only applies to assets held > 1 year)

traveler01 4y ago
I get some public services need the tax money to function. But governments nowadays tax people beyond oblivion, specially in Europe.
- speedgoose 4y ago
  The average European has a good quality of life though.
  - seibelj 4y ago
    Yeah it’s crazy why anyone emigrates from Europe to the US
    - chii 4y ago
      it's hard to get high wages in europe compared to america. So it makes sense to work in america for a while, save and invest, and eventually come back to europe to retire or live a more leisurely lifestyle.
      - seibelj 4y ago
        But their lifestyle is so much worse the moment they step foot in America
        bowsamic 4y ago
        mrep 4y ago

p2detar 4y ago

How does this work? Do you declare that you have sold crypto at all, or you just sell after one year without notifying anyone?

davidkuennen 4y ago
The second option. I simply didn't notify anyone and so far no one asked about it. Maybe because the money came from Binance (crypto) they simply didn't bother or something.
- dewey 4y ago
  > I simply didn't notify anyone and so far no one asked about it. That's not really how it works though. You are not supposed to wait for them to ask you about it, you declare it truthfully and otherwise it's tax evasion. Not sure if that applies for your case but that's how these kind of taxes usually work.
  - Aachen 4y ago
    Sounds like GP basically walked out of a shop with goods in their bag and is now posting online how happily surprised they are it was free for a change. Yeah, if you don't go to the register then you don't pay. Until the day someone finds out.
    - samatman 4y ago
      Chewing bubblegum isn't a taxable event so I don't tell the IRS when I do it. Or giving my friend a drone for his birthday, if you prefer something closer to the topic. If selling ETH after holding it for a year isn't a taxable event in Germany, and it sounds very much like it isn't, on what basis should this be reported to the tax authorities?
      - p2detar 4y ago
        Actually, my not up-to-date info is that one is pretty much always required to declare the winnings of crypto sales in their Lohnsteuererklärung. Winnings below 600EUR or winnings for crypto assets sold after 1 year of possession are tax free. I have some crypto that I bought last year and some that I bought many years ago that don't have any transactions records for and now I'm lost at how to properly declare a sale. Honestly, the complexity of this is stopping me from doing more crypto trading.

Cthulhu_ 4y ago

I do some amateur stonks trading and I believe the bank I trade at will withhold some taxes for dividends paid; I presume that the total monetary value of stocks + cash held on January 1st of every year is passed on to the tax office, who will use it for capital gains taxes (iirc it's a percentage of 4% of the amount, that is, they assume you will, on average, be able to get a 4% ROI on investments and tax that return). This difference between income taxes and possession / investment taxes is why pretty much everywhere in the world, high ranking and high earning people don't pay as much taxes because their earnings will be from stocks and non-wage income. I'm sure there's macro-economic reasons behind it, I dunno.

dathinab 4y ago

> was a very strange feeling to receive that completely untaxed, Well thats the absurdity of the German tax system. People which do not have much don't pay much taxes (lower %cut). People who are more wealthy then that pay a lot of taxes (max %cut). People who are even more wealthy again much less taxes (still max %cut, but docents of ways to circumvent taxes, and "safely" launder money e.g. by going through art collections, buildings etc.).

xioxox 4y ago
It also has crazy things like taxation on energy produced by your solar panels that you use yourself.
- dathinab 4y ago
  It has taxation on energy usage independent of source. Given that traditionally alternate sources where things like companies having their own small gas power plant or similar this isn't really crazy. (Some details you can skip: The law effectively was about preventing circumvention of taxes on wasting energy, preventing unhealthy fragmentation in the power grid, making stabilizing the power grid easier and helping/subventing electric companies which back then often where state owned, i.e. tax payer financed; The law somewhat made sense for this goals, in the past. But only in the past. Change in technology and the ecosystem make it IMHO sub-optimal today. Today we probably should push for interconnected micro-grids with some decentralized energy sources each.) Today the law is stuck in the past and should be changed IMHO. At least an exception for green decentralized energy and/or excluding (only) small producers should be done, maybe more. Thinking about it currently is the best political weather for it.
svachalek 4y ago
It's the same in the US.

Mehringotio 4y ago

You will need to pay taxes as you are required to mention this in your tax form. Otherwise it's just tax fraud. I would put 20-30k aside to be save.

SZJX 4y ago
Nah. It’s mentioned in multiple places in this thread that crypto, just like any other personal asset, is tax-free after being held for a year. It has always been so. Not sure on what basis you arrived at the conclusion that “You will need to pay taxes as you are required to mention this in your tax form.” Also see https://www.toytowngermany.com/forum/topic/370675-taxation-on-crypto-currencies/ https://www.toytowngermany.com/forum/topic/370675-taxation-o...

SZJX 4y ago

Yeah it’s a pretty surreal feeling especially considering how Germany has an absolutely antiquated system on startup stock options that would simply tax your potential gains to oblivion, which ranks bottom in Europe together with Belgium. See https://www.indexventures.com/rewardingtalent/country-detail-tables-germany https://www.indexventures.com/rewardingtalent/country-detail... Still considering leaving in the near future because of this and a few other factors (e.g. gloomy winter).