Bitcoin Savings Plan and Tax: Holding Period, FIFO and €1,000 Exemption

A new explainer outlines Germany’s rules for a Bitcoin savings plan and tax treatment of monthly buys. Each instalment is treated as a separate acquisition for income tax purposes under Section 23 EStG, so the one-year holding period runs independently per tranche. If a sale happens within one year of specific monthly buys, part of the gain may be taxable while other parts remain tax-free. The article confirms that crypto is “other assets” for Section 23 EStG (citing the Federal Fiscal Court judgment of Feb 14, 2023). Gains are taxed at the investor’s personal income tax rate, with no flat withholding. A key threshold is the €1,000 exemption limit: if total private disposal gains in a calendar year reach €1,000, the entire amount becomes taxable (not only the excess). Losses can offset gains only within the same private disposal category and only up to the year’s realised gains; they cannot be used against salary or share gains. For selling tranches built from many months of buys, disposal is handled via individual identification when possible; otherwise FIFO (for holding-period purposes) and average-cost valuation may apply. Tax treatment is wallet-by-wallet, and the valuation method should be fixed per wallet. The piece also stresses documentation: transaction statements may be subject to extended duties for foreign platforms, and missing records—e.g., due to platform insolvency—are borne by the taxpayer. Traders’ takeaway: the Bitcoin savings plan and tax mechanics mainly affect after you sell, but they can change investors’ sell timing, record-keeping behaviour, and expected tax-driven liquidity over the next 12 months.