Bitcoin transactions are tax-free after one year

A parliamentary inquiry creates clarity: sale of Bitcoins are subject to a one-year holding period, no withholding tax. This makes the currency attractive to investors.

With Bitcoins winnings will be tax-free after one year. Thus, the digital money from the Treasury treated differently than, for example, stocks, bonds or certificates.

All of these asset classes are subject to withholding tax of 25 percent plus solidarity surcharge and church tax. In bitcoins falls after a holding period of one year on the other hand, no such tax.

The tax exemption of capital gains in Bitcoins findings of a parliamentary inquiry that has provided to the federal government the FDP financial expert Frank Schaeffler and the "world" exists. "It is good that investments in Bitcoins is finally legal certainty. Private profits from the sale of Bitcoins are tax-free after one year," said Schaeffler.

The legal nature and tax treatment of digital currency has been controversial for a long time. The response of the federal government only creates clarity. For fans of cyber-currency, it covers a lot of money. Despite strong fluctuations in the price of Bitcoin is now more than twelve times as high as twelve months ago. The tax treatment for investors is therefore of great importance.

An example illustrates this: in online exchanges like bitcoin.de or mtgox.com 100 Bitcoins could be acquired in mid-2012 for about 550 euros. Today, the same amount is worth about 7600 euros.

Event of a sale after more than twelve months holding period therefore falls to a gain of about 7000 euro. The flat tax would strike here at 1750 euros. Legally, these are for a private sale transaction under Section 23, paragraph 1, point 2 of the Income Tax Act.