How do I implement tax-loss harvesting with cryptocurrency in Germany?

• Selling crypto at a loss can offset other crypto gains; keep lot-level records with EUR values on purchase and sale dates.
• Be mindful of 1-year holding periods on positive lots; selling a profitable lot before one year can create taxable gains you didn’t plan.
• €600 Freigrenze (§23 EStG): If your total gains from private sales (crypto, gold, etc.) in a calendar year are below €600, they are completely tax-free. If you exceed €600, the entire amount is taxable — not just the portion above €600. This is a threshold, not an allowance.
• FIFO is the default: Germany applies the First-In, First-Out (FIFO) method by default when identifying which lots are sold. Some platforms allow other methods, but you must be consistent and document your approach.
• No formal wash-sale rules: Germany does not have a codified wash-sale rule equivalent to the US rule. However, “selling and immediately rebuying” the same asset can be challenged by tax authorities under substance over form (Gestaltungsmissbrauch) principles if there is no economic change. Space out transactions and avoid obvious circular flows on the same platform.

• Selling a coin for fiat or another coin.
• Paying for goods/services with crypto.
• Staking rewards, airdrops, mining proceeds are typically taxable income when received; subsequent disposal can create gains/losses.

• Transaction log per asset: date/time, quantity, EUR value, fees, counter-asset.
• Lot ID method: FIFO is the German default under §23 EStG; some platforms offer other methods, but document whichever you use and apply it consistently across the year.
• Separate logs for income (staking/airdrop) vs capital transactions.

1. Inventory lots with current unrealised gains/losses.
2. Prioritise selling loss lots with short remaining holding periods or assets you don’t want long term.
3. Avoid instant rebuy of the same asset on the same venue; wait a sensible period or switch to a different asset that keeps your risk profile similar.
4. Don’t harvest so aggressively that you create income elsewhere (e.g., moving coins into a staking product you’ll later unwind).
5. Keep proof of prices at sale/purchase times.

• Swaps between coins are disposals; you realise gain/loss in EUR terms each time.
• Bridges, wrappers, and L2 moves can be ambiguous: save on-chain proofs and screenshots.
• If you use multiple exchanges and wallets, consolidate into a master ledger.

• You bought 1.2 BTC across three lots; one lot is at a €3,000 loss.
• You sell only that loss lot this year to offset gains from an ETH trade.
• You wait before repurchasing BTC, or you hold a broad crypto ETP instead for a while to maintain exposure.

• Selling everything and accidentally realising big gains on old profitable lots.
• No EUR valuation at each transaction time.
• Rebuying immediately in a way that looks like a circular trade with no economic change — while Germany has no formal wash-sale rule, tax authorities can challenge circular transactions under Gestaltungsmissbrauch (abuse of legal structure) if there is no genuine economic purpose.
• Ignoring income from staking/airdrops: these change your basis and create separate taxable items.

1. Export all CSV histories; build a lot ledger.
2. Identify target loss lots and a timeline for harvesting.
3. Execute with spacing and keep documentation.
4. File with clear supporting schedules; keep data for at least 10 years.

🧮 For non-crypto investments, see our ETF Investment Calculator and All Calculators.

⚠️ IMPORTANT LEGAL DISCLAIMER:

This content is for educational and informational purposes only and does not constitute financial, tax, legal, or investment advice. You should not rely on this information as a substitute for, nor does it replace, professional financial or tax advice. Always consult with qualified professionals (tax advisors, financial planners, lawyers) before making any financial decisions or taking any actions based on this information.

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Disclaimer: This is general information and may differ for individual cases. Learn more about financial planning with Financemate in a discovery call. Always confirm with a tax professional before large transactions.