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Germany to tax crypto gains at 26.375%, ending tax-free holding period from 2027

Market News
11 Sep 2026
Crypto news
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Bearish
Germany to tax crypto gains at 26.375%, ending tax-free holding period from 2027

Germany's Finance Ministry proposed a draft bill to end the one-year tax-free holding period for cryptocurrencies, replacing it with a flat capital income tax of 26.375% (25% plus 5.5% surcharge) on gains from assets bought on or after January 1, 2027. This change benefits short-term traders by lowering their tax rate from up to 45% to 26.375%, but long-term holders lose their current exemption and will pay tax on gains. Crypto service providers must start withholding this tax automatically from January 1, 2028. The bill aims to align crypto taxation with other capital income and is part of the 2027 budget, making it harder to remove. The grandfathering provision for assets bought before 2027 is still under discussion. Investors should prepare documentation of purchase prices to avoid higher taxes on undocumented sales.

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