Excerpt
I explain whether using coin control to manage your UTXOs affects the tax-free holding period in Germany. Watch now to learn when moving bitcoin is considered a taxable event and how to ensure your transactions don’t reset your holding period.
Transcript
Well, you know I’m not a tax advisor. What I’m saying is only what I know so far. In some countries, the tax laws regarding Bitcoin are fantastic. Germany is such an example. For instance, if you hold your Bitcoin in Germany longer than 12 months after purchasing or receiving it, you won’t need to pay capital gains tax on them – forever, basically. That means if you spend your Bitcoin within those 12 months, you will need to pay those taxes. It’s basically the increase in Bitcoin’s value from when you received it to the time when you spent it. On this difference, you will need to pay taxes. But if you move bitcoin from your own UTXOs, from within your own wallet basically, to a new address that you also own, this is not a selling event. So, you don’t spend your bitcoin in that sense, and as far as I know, this is not a taxable event. So the holding period doesn’t start new. I would, that’s a recommendation, I would record those transactions – meaning, write down what you did, label the transactions, make notes to, and make screenshots so you can explain to the tax authorities that you didn’t sell the bitcoin, but sent it to yourself.
