Tax Trading Coin to Coin

[Wiss]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

[1715138986]

1715138986

[1715138986]

1715138986

[1715138986]

1715138986

[Wiss]

No ideas?

[TrumpD]

I'd suggest you call your local Internal revenue service or its equivalent in Germany for an accurate answer. But from my experience, most countries and jurisdictions have no idea what to do about income derived from bitcoin. The majority make it up as they go, and where it is taxed, it is as a commodity similar to Gold.

[mrbnson]

To my understanding, in most countries you will not pay any tax because you have not converted your BTC back in to fiat, if you convert to fiat then you will have to pay tax, perhaps not on such a small gain however.

[Flor1982]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

It will depend upon your government policy regarding your exchanger. Here in our country everytime we use our local exchange service from bitcoin to our local paper money and vice versa there is always a fee in which service fees and tax free are already combined and already paid during the conversion therefore tax is already paid.

[Jovovich]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

It will depend upon your government policy regarding your exchanger. Here in our country everytime we use our local exchange service from bitcoin to our local paper money and vice versa there is always a fee in which service fees and tax free are already combined and already paid during the conversion therefore tax is already paid.

That and i think that kind of trade just needs transaction fee rather than government tax. the only time government would interfere if the traded coin will be converted to fiat. And as of now not all government regulates nor accept bitcoin as a means of transaction IRL.

[malikusama]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

Tax policies varies from country to country that what percentage of tax is applicable on a give amount or savings. In my country there isn't any coin2coin trading tax as per rules but tax will only apply if you convert it into fiat. I think most of the countries are following the same procedure of taxation that when amount is converted into fiat you have to pay tax not on coin2coin trading tax.

[harizen]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

I don't have any idea how your country deals with the tax system of crypto exchanges or any related crypto activities.

Generally, there is no tax when doing trades. Once you will sell it (convert) to fiat then you have no choice but to deal with the selling rate of that exchanger + withdrawal fees. The selling price here is sometimes not closed to the average selling rate of the whole bitcoin exchanges. In here, it's like facing tax but on different form since you will not get the supposedly amount you must received.

[Serpens66]

incredible how many people still think that only "trade in fiat" is taxed.
I know not a single country were this is true! and I know it for most european countries and also whole US.
Every profit is taxed, regardless if you changed BTC into fiat, into Altcoin, or into coffee.

At every trade you need to calculate in fiat.
There is no answer to your example cause it is incomplete. You need to know the fiat value of BTC at every trade.
In second month it depends if your 1 BTC is worth more fiat than in month 1. If you bought it for 1000€ and in month 2 it is 1200€/BTC, then your profit in month 2 is 200€.

You can imagine it this way:
You do NOT change BTC into NEO. Out of tax perspective, you are selling BTC to EUR and buying NEO with those EUR.
So if you theoretically got more EUR than you spent, you have a profit here. Same for losses of course.

[babyshaun]

Hi,

one short questions regarding tax policy in Germany.

The following example:
Month 1: Buy 1 BTC via Fiat
Month 2: Trade 1 BTC to 200 NEO
Month 3: Trade 200 NEO to 1,2 BTC (because of profit the value increases to 1,2)

Do i have to pay taxes until now?

Month 4: Sell 1,2 BTC to fiat

Here i have to pay for sure taxes for the 0,2 BTC profit or?

So may general question is do i have to pay taxes because of profit for coin2coin trading? or is it just necessary when I trade to fiat?

so far no bitcoin is available yet. I just want to know your country why bitcoin is taxed on you here at no cost .. here is the place where you are going to just get money without even passing the tax. but I have no idea why you have taxes there.

[squatz1]

Well crazily enogh, not everyone on here (Bitcointalk) is going to be knowledgeable in tax laws for their own country, let alone other countries around the world. But I'll give ya some advice.

One thing here is that you're not going to have to record the money that you make until the sale, as anything on paper isn't something that should be realized as profit yet. Only when it's sold.

Though work with your IRS alternative in the country which you live in and I think they'll happily give you all the information which you need.

[JaFa]

How on earth is anybody going to determine "profit" from coin to coin trades when the value of the coin could tank 80% in the next hour.  Alts crash all the time, and none of that so-called "profit" is REALIZED until you cash out.  Never mind the fact that the exchanges exist in pretty much every country in the world, with different rules guiding each one.  Then factor in the tax rules in most countries barely acknowledge crypto even exists.

You're never going to get a correct answer for this from these forums.  All I can suggest is use some common sense.  If you're withdrawing tens of thousands of dollars to your bank account, chances are someone is going to notice.  Capital gains/investment gain rules might apply in that situation.  If it is from earnings, perhaps self employment rules might apply.  Being able to justify your reasoning to tax assessors is key.