Germany! Tax-Free For Cryptocurrency Users!

in #germany7 years ago (edited)

The impulse of good news on cryptocurrency adoption in Germany came after the Ministry of Finance Official; Peter Altmaier clarified that individual crypto traders in the country would not be taxed! At a time when the whole globe is analyzing on crypto regulations, the news could not have arrived at a better moment than now! Hence, cryptocurrency users in Germany feel the use of digital currency is facing a great and wider move!

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About the ruling, Germany is seen to have taken a diverse approach to dealing with the crypto issue as compared to the United States. In the U.S., the Internal Revenue Service considers the use of cryptocurrencies as part of property ownership, hence subject to capital gains taxes.

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In Germany, when transacting cryptocurrencies for services or goods, the virtual currency involved is observed as a means of payment! Therefore, the Bundesministerium der Finanzen verdict came after the 2015 ruling of European Union Court of Justice on the matter of value-added taxes. Besides, the ruling of the court established a guideline to EU countries. Hence, the involved countries may tax bitcoin but on certain transaction exemptions! And if someone decides to purchase something using cryptocurrencies, the EU’s VAT Directive article will apply when the transaction is processed!

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Another vital document aspect is that cryptocurrency miners who receive block rewards are not to be taxed! As per the document, their services are considered voluntary. However, crypto exchanges that take place in the marketplace will pay taxes but those who buy or sell cryptocurrencies as individuals, will not pay taxes!

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On the report issued on February 27, the German Court in line with European Union Court of Justice decision, it justified its financial ruling by signifying that it considered cryptocurrency as a legal method of payment! But with the condition that the virtual currencies are contractual or alternative means of payment between parties and thus have no other purposes rather than being applied as a way of the transaction!

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Depending on that ruling, changing of crypto to fiat and vice versa is regarded as “other taxable services”. Hence, parties acting as an intermediary for such exchanges will not be taxed! As a result of that provision, cryptographic traders could also benefit from exemptions of tax.

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The ruling also noted that mining royalties are not subjected to tax since they are paid on a voluntary basis! Also, the order differentiates Germany from USA where the Internal Revenue Service (IRS) of the later considers cryptocurrencies as property. That indicates that every form of crypto utilization within the USA is technically regarded as a sale of property and is thus subjected to capital gains tax! For instance, if someone in America buys a cup of tea using bitcoin, it’s considered as a sale of property and thus not exempted from the tax. However, in Germany, use of crypto is considered as similar to legal tender for paying tax when used as means of payment, as per the new document by the Bundesministerium der Finanzen ruling! For purposes of tax, it indicates that changing crypto into fiat currency or vice versa is regarded as “taxable miscellaneous benefit”. Thus in EU, the actual act of changing cryptocurrency to fiat or vice versa is considered as a "supply of services”.

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Payment charges sent to digital wallet suppliers or other services can also be taxed. Other cryptocurrency ecosystem aspects will not be taxed! Besides, miners who get block rewards are not subjected to tax since the services are regarded as voluntary as per that document. You can check more information about the European Union Court of Justice verdict on following sources.

https://ec.europa.eu/taxation_customs/infringements/eu-court-justice-case-law_en
https://www.lindeverlag.at/buch/cjeu-recent-developments-in-value-added-tax-2014-6188/e/leseprobe/E00648.pdf
https://ftp.repec.org/opt/ReDIF/RePEc/rau/clieui/FA09/CLI-FA09-A5.pdf

You can also go through some of my recent posts below:
https://steemit.com/news/@cryptofy/dmarket-the-world-s-first-decentralized-cross-game-marketplace
https://steemit.com/investment/@cryptofy/usd1-trillion-investment-company-ready-for-cryptocurrency
https://steemit.com/news/@cryptofy/swissborg-the-new-era-of-crypto-wealth-management
https://steemit.com/altcoin/@cryptofy/5-altcoins-you-may-think-investing-in
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thank you so much but why you give this gift?

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Thank you and I look forward to reading.

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tidak lama lagi mungkin crypto akan menguasai pasar

Thanks for the beautiful sharing.:)

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