Taxation on private income from cryptocurrencies

More and more private individuals hold cryptocurrencies in their assets. Cryptocurrencies must be declared in the tax return and are taxable as assets. There are several points to distinguish regarding the taxation of gains and losses from cryptocurrencies.

Tax-Free Capital Gains

If cryptocurrencies are held as private assets, capital gains are tax-free, similar to other securities. However, capital losses are also tax-irrelevant and cannot be deducted from taxable income.

Cryptocurrencies in Business Assets

If cryptocurrencies are part of business assets, the tax regulations for self-employment apply. In particular, this includes commercial trading of cryptocurrencies. The practices applied to commercial securities trading are analogously used for demarcation from private asset management.

Mining

The mining of cryptocurrencies, through the compensated provision of computing power by a natural person, is qualified as taxable income from self-employment.

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