Peter Altmaier – Ministry of Finance [Germany] stated out that individuals that complete payments with the use of digital currencies will not be taxed. The news and shared information is very welcoming and warming coming form Germany in a time when several other countries are taking a much stricter approach towards cryptocurrencies.
The internal Revenue Service – In the United States do put down the leader – Bitcoin and following coins as property for tax purposes in which case any transaction of the digital currencies could be set on sale-of-property status making it subject to capital gains tax.
While in Germany, using a cryptocurrencies for purchasing services or goods of any form, the coin which the individual used is considered as a means of paying. The Bunderministerium der Finanzen followed a 2015 European Union Court of Justice ruling on value added taxes. The court ruling sets a precedent for EU nations. They are able to tax bitcoin but providing exemptions for certain type of transaction.
“Virtual currencies (cryptocurrencies, e.g., Bitcoin) become the equivalent to legal means of payment, insofar as these so-called virtual currencies of those involved in the transaction as an alternative contractual and immediate means of payment have been accepted.”
An article of the EU’s VAT Directive will add to the value of the token for a certain coin when the transfer is completed in the event of an individuals purchasing anything with BTC or any altcoin.
In the case when traditional fiat currency is converted to crypto or crypto to fiat, the transaction is names as a supply of services which concludes with the individual [party] taking place as an intermediary for the trading platform [exchange] is not put under tax – going and according to EU ruling.
And as an addition to all the above, the good crypto-miners that accept block rewards are also not to be taxed. Based on the document, the work and service that they deliver is voluntary. However, Crypto exchanges that are operating as a marketplace will be taxed and these who sell or buy cryptocurrencies in their own name will be exempted from taxes.
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