Taxes on Bitcoin and co. in Switzerland

Information on cryptocurrency taxation

Cryptocurrencies and taxes in Switzerland

The taxation of cryptocurrencies is not explicitly regulated by law in Germany, but rather general tax regulations are applied, which, however, are not always unproblematic due to the novelty of digital assets. The Federal Ministry of Finance has expressed its view for the first time in a letter from Febuary 2018 on individual issues of taxation, which binds tax offices in Germany. This letter concerns only value added tax. Comprehensive administrative instructions or fiscal court decisions do not yet exist.

General crypto tax situation in Switzerland

If a cryptocurrency was purchased and sold within one year, “speculative transactions” within the meaning of § 23 Para. 1 No. 2 of the German Income Tax Act (EStG) applies. The applicable tax rate is the standard individual income tax. This amounts to between 14 % and 45 % (the solidarity surcharge is 5.5 % of the tax rate).

In response to a parliamentary inquiry, the German Federal Government has stated that income from private mining may constitute other income pursuant to § 22 No. 3 EStG. In mining, the threshold to commercialism, a sustainable, self-employed activity with the intention of making a profit, is quickly crossed.

Taxation of cryptocurrencies in the canton of Zurich

An exemption limit of 600 euros p.a. applies – however, the exemption limit applies to all private sale transactions in the year in question, i.e. it does not only apply to the taxpayer’s crypto transactions.

Tax-free trades do not have to be specified in the tax return, but investors should carefully document both tax-free trades and taxable trades to provide the tax authorities with appropriate and complete evidence of the transactions made.

Die deutsche Bundesregierung hat sich in einer Antwort auf eine parlamentarische Anfrage dahingehend geäußert, dass Einkünfte aus privatem Mining sonstige Einkünfte gemäß § 22 Nr. 3 EStG darstellen können. Beim Mining ist die Schwelle zur Gewerblichkeit, einer nachhaltigen, selbstständigen Tätigkeit mit Gewinnerzielungsabsicht, aber schnell überschritten. Detaillierte Informationen zu dieser Thematik erhalten Sie auch in unserem Kryptosteuer Guide.

Taxation of cryptocurrencies in the canton of Berne

The classification as a speculative object means that capital gains are completely tax-free after a holding period of at least one year. However, not all coins that are sold have been “acquired” within the meaning of this provision, as the sellers may have received them by means other than simple purchase on a stock exchange.

If a transaction is completed within the one-year holding period, an exemption limit of 600 Euros p.a. applies – however, the exemption limit applies to all private sales in the relevant year and therefore does not only apply to the taxpayer’s crypto transactions.

Einkünfte unterhalb dieser Freigrenze müssen nicht angegeben werden. Es empfiehlt sich jedoch diese Transaktionen trotzdem aufzuzeichnen und im Falle (z.B. auch Banken gegenüber als Herkunftsnachweis) vorweisen zu können.

Taxation of cryptocurrencies in the canton of Lucerne

In Germany the general deadline for filing annual tax returns ends on 31 May – at least for those who have to file an income tax return. If you do not deliver on time, you may have to pay a penalty fee. The processing takes place via “Elster” (German electronic tax file).

 

Taxation of cryptocurrencies in the canton of Zug

According to german legislation, the first-in-first-out method (FiFo) is most suitable for reliably determining the acquisition costs of cryptocurrencies (cf. LfSt Bayern v. 12.3.2013, p. 2256.1.1-6/4 St32). In other words, it is assumed that those coins which were first purchased / mined are also those which were first used in the context of the private sale transaction. Experience values for the legal treatment of other calculation methods (e.g. last-in-first-out) are scarce to non-existent. When determining the acquisition costs, the problem often arises that coins were acquired at different times and different exchange rates/acquisition costs.

With Blockpit you can create a tax report where your transactions are automatically arranged according to FIFO.

Taxation of cryptocurrencies in the canton of Basel

Losses can be offset and carried forward in both past and future tax years, thus offsetting gains from private sales.

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Cryptocurrencies & taxation are complex and hard to grasp issues, therefore our focus is on making the platform easy to use, as well as providing great usability. As cryptocurrency-tax.info clearly shows, filing taxes for cryptocurrencies like Bitcoin, Ethereum and co. concerns investors and traders just as much as government bodies and corporations. Our partner network consisting of certified tax advisors provides the added value of not having to rely on a black box when calculating crypto tax profits, but instead being able to rely on a certified, compliant report. Correctly file your cryptocurrency taxes and stay on the safe side with officially validated tax documentation.