Staking rewards may feel like a hands-off way to grow your crypto portfolio, but the tax office in Germany sees it differently. Whether you’re locking tokens in a wallet or delegating assets to a validator, these rewards often count as taxable income.
Until recently, there was confusion about how long you needed to hold staked assets to sell them tax-free. Investors worried the holding period might extend to 10 years, but new rules have confirmed that the standard one-year rule still applies. That’s good news for anyone planning to hold before selling.
But not all staking is the same. Some methods can even shift your rewards into the commercial income category, bringing added tax consequences. In this guide, we explain how staking is taxed, when to report it, and how to avoid common filing mistakes. If you earn from staking, here’s what you need to know.
Are Staking Rewards Taxable in Germany?
Yes, staking rewards are taxable in Germany. Most staking income is classified as “other income” under Section 22 No. 3 of the Einkommensteuergesetz (EStG) or the Income Tax Act. If your total additional income from such sources stays below €256 in a financial year, you are exempt from filing. Once this limit is crossed, the full amount becomes taxable at your personal income tax rate.
The taxable amount is based on the market value of the rewards at the time you receive them. Whether the tokens are earned through cold staking, delegated staking, or validator nodes, the same threshold applies. Keeping a record of each reward’s value in euros on the day of receipt is important for accurate tax reporting.
If you earn staking rewards frequently or in large volumes, you may need to track them as part of your broader crypto income. In such cases, a detailed tax report ensures you meet all legal requirements.
How Are Staking Rewards Classified for Tax Purposes?
The way your staking rewards are taxed depends on how the activity is classified under German tax law. The classification decides how the rewards are treated and what rules apply for filing.
Income From Other Services (Section 22 No. 3 EStG)
For most individual investors, staking is viewed as a private activity. If you simply delegate or lock your tokens and earn rewards passively, the income is considered to fall under “other services.” You make your crypto assets available to the network and, in return, receive rewards. This is seen as a service that produces a return.
As per Section 22 No. 3 of the Einkommensteuergesetz, income from other services is only taxable if your total additional income for the year exceeds €256. If your total rewards stay below this threshold, you do not need to file or pay tax on them.
Commercial Income (Section 15 EStG)
In limited cases, staking may be treated as a business activity. If you operate a large-scale staking setup, actively participate in block creation, or run a node, you may be classified under commercial income rules. The decision is based on factors like regularity, scale, independence, and control over how rewards are earned.
The Bundesministerium der Finanzen has stated that staking with active roles, such as proof-of-stake mining, may count as commercial. This can bring additional reporting duties and liabilities. If your activity resembles a structured business, it is best to consult a tax advisor to avoid misclassification.
What Is the Tax Treatment of Different Types of Staking?
Not all staking methods are treated the same by German tax authorities. The way you stake, actively or passively, can impact how your rewards are taxed. Below are the major staking types and how each is viewed under current tax interpretations.
Proof-of-Stake Mining (Forging)
This method involves active participation in the validation of blocks on a proof-of-stake blockchain. It typically requires technical involvement, infrastructure, and consistency in staking operations. The Bundesministerium der Finanzen considers this form of staking as commercial in nature.
Due to the level of engagement and independence involved, rewards from forging are viewed as income from a commercial activity. This may result in additional obligations such as trade tax and stricter reporting requirements. Investors using this method should evaluate whether their staking resembles a structured business setup.
Cold Staking or Delegated Staking
Cold staking involves locking tokens without taking an active role in validating blocks. Delegated staking allows users to assign their coins to validators who perform the actual work. In both cases, there is no direct involvement in the technical operations of the blockchain.
German tax authorities generally classify rewards from cold or delegated staking as income from other services. As long as the income remains below €256 in a financial year, it stays tax-free. However, if the total exceeds this threshold, the full amount becomes taxable under your individual income tax rate.
When Are Staked Tokens Taxable Upon Sale?
Once you receive staking rewards, simply holding them is not the end of your tax obligations. Selling, swapping, or using these tokens can also lead to additional tax liabilities, depending on how long you hold them after receipt.
Disposing Within One Year
If you sell your staking rewards within one year of receiving them, any profits from that sale are treated as taxable income. This includes converting them to fiat or swapping them for another cryptocurrency. The gain is calculated by subtracting the value at the time of receipt from the price at the time of sale.
Disposing After One Year
If you hold your staking rewards for more than one year before selling, the profits are tax-free. This holding period starts from the day you receive the reward, not from when the original tokens were staked. Meeting the one-year rule gives you full exemption from tax on that profit.
Does Staking Affect the Holding Period of Crypto?
Earlier, there was concern that staking could extend the holding period of crypto assets from one year to ten years. This would have delayed the tax-free sale of staked tokens significantly. However, this concern has been addressed by the updated administrative guidance.
According to the official letter published by the German Ministry of Finance on 10 May 2022, staking no longer changes the one-year holding period. The same rule applies to crypto assets used in lending. If you hold your tokens for over one year, regardless of whether they were staked or lent, you can sell them without triggering any tax.
Do You Need to Report Staking Rewards in Germany?
If you earn any income from staking crypto, you have a legal responsibility to report it in your annual tax return. German tax law requires all forms of additional income to be declared, including rewards from staking, once they exceed the exemption threshold.
Reporting Threshold and Requirement
You are not required to file a return for staking income if the total amount earned remains below €256 in a financial year. However, once your staking income crosses this threshold, the full amount becomes taxable. It must be reported in your Einkommensteuererklärung as part of your overall income. This rule applies regardless of whether you use cold staking, delegated staking, or participate in validator pools.
When to Include Staking Rewards?
Staking rewards must be included in your tax return for the year in which they are received. The amount to report is the market value of the tokens on the day they are credited to your wallet. Delaying or omitting this income from your return may result in penalties, even if the total tax due is low. Accurate reporting ensures full compliance with the rules set by the German tax office.
How KoinX Helps You Report Staking Rewards in Germany
Reporting staking income can feel overwhelming, especially with different wallets, chains, and reward structures. KoinX simplifies every step of the process. It is among the few crypto tax tools that fully support staking transactions and generate accurate, BZSt-compliant reports that include rewards, disposals, and fair market values. Here is how KoinX helps:
Seamless Integration
KoinX integrates with 300+ platforms, including exchanges, staking wallets, and validator nodes. It fetches your staking rewards automatically and maps them to the correct dates and values. You do not need to track or enter anything manually.
BZSt Compliant Tax Reports
KoinX generates tax reports based on the German tax authority’s rules. The report separates staking income, reward values, and sales. It ensures correct classification under income from other services and includes values needed for Anlage SO and ESt 1 A.
Safe and Secure
KoinX uses advanced encryption to protect your data and identity. All your staking activity remains secure and private within your account. No personal details are ever shared with third parties without consent.
Accurate Portfolio
With KoinX, you can monitor your staking rewards and overall crypto portfolio in one place. It tracks all tokens, including the rewards earned, so you always know when to sell or hold based on your tax status.
Automatic Classification of Transactions
KoinX auto-detects which of your transactions are staking rewards and applies the correct German tax treatment. This removes confusion and ensures that all rewards are classified properly in your report without extra effort from your side.
Join KoinX today to track, classify, and report your staking rewards accurately in Germany. Get started for free and avoid errors in your tax return.
Conclusion
Staking rewards can be a reliable way to grow your crypto holdings, but they also come with specific tax responsibilities in Germany. Whether you stake through a validator or a platform, you must account for your earnings and any future sale of those rewards in your tax return. Reporting accurately is not just about avoiding penalties but also about staying aligned with legal obligations.
KoinX offers the easiest and most reliable way to handle your staking taxes. From automatic reward tracking to generating compliant tax reports, KoinX ensures nothing is missed. Sign up today and file your staking taxes in Germany with clarity and confidence.
Frequently Asked Questions
Is It Legal To Earn Income From Staking Crypto In Germany?
Yes, it is legal to earn staking income in Germany. However, it must be reported as part of your income tax filing if it exceeds the exemption threshold. Both individual investors and platforms must follow German tax rules, including proper classification of rewards and accurate reporting.
What Happens If I Do Not Report My Staking Rewards?
If you do not report staking rewards that exceed €256 in a year, you could face penalties, interest, and even legal consequences. The German tax office expects full disclosure of all crypto-related earnings, including passive rewards. It is advisable to report accurately, even if the tax due is minimal.
How Do I Calculate Gains From Selling My Staked Tokens?
To calculate gains, subtract the value of the tokens when you received them from the sale price. If you sell within one year, profits are taxable. If you wait more than one year, the gain is tax-free. Accurate records are essential for calculating your exact profit and tax liability.
Can I Claim Losses On My Staked Assets?
Yes, if you sell staked tokens at a loss, you may be able to use that loss to offset other gains, but only under certain conditions. Loss reporting must follow specific tax rules and depends on whether the asset was held as a private or business investment.
Does Staking Through Platforms Like Binance Or Kraken Change The Tax Rules?
No, staking through centralised platforms does not change the tax rules. The tax office treats rewards the same regardless of whether you stake independently or through a platform. You are still responsible for reporting income and capital gains based on the value and holding period of the tokens.
