From 01.01.2024, Austrian crypto platforms and brokers are required to withhold capital gains tax when selling cryptocurrencies purchased from 01.03.2021. This also applies to your sales of Bitcoin for euros via Coinfinity, provided that you have a main place of residence or habitual residence in Austria. In order to correctly calculate capital gains tax, Coinfinity requires information on acquisition times and costs, which must then be checked for plausibility by Coinfinity.
What this means for you as a customer of Coinfinity is what we have from Cryptotax by Enzinger Illustrated for you using simple examples. Cryptotax by enzinger is the leading tax consulting firm for crypto assets in Austria.
In this post, we'll explain to you what happens when you sell at Coinfinity from 01.01.2024, how much tax is withheld, and whether you still have to enter the sale in your tax return.
If you purchased Bitcoin from 01.03.2021, these are new crypto assets and selling them for euros is subject to capital gains tax. Coinfinity withholds 27.5% capital gains tax from your capital gains (sale proceeds minus acquisition costs).
Should Bitcoin be sequentially (“in several tranches at different acquisition costs”) have been purchased and stored at a Bitcoin address and no individual allocation (e.g. using Coin Control, see point 4) of the respective purchases (receipts or”UTXO“) be possible for the respective sale, the acquisition costs must be determined using the moving average price method. The moving average price per Bitcoin is calculated by dividing the sum of the acquisition costs of the individual tranches by the amount of Bitcoin.
In order for the capital gain to be calculated correctly, you must inform Coinfinity of your acquisition costs and the date of purchase. Coinfinity calculates the capital gains tax and pays the withheld tax directly to the tax office. If you have truthfully reported your purchase costs and time of purchase, you no longer have to enter the sale in your tax return. If you have no or only incomplete data (acquisition costs, date of purchase) available, you must have a lump sum KEST deduction made via the crypto platform (see point 3).
If you purchased your Bitcoin before 01.03.2021, these are old crypto assets. Old assets can be sold tax-free and there is no KEST deduction.
In this case, too, it is necessary that you inform Coinfinity of your purchase costs and the time of purchase so that Coinfinity knows that a KEST deduction can be omitted. If you do not notify us, Coinfinity must assume that new assets will be sold and there will be a lump sum KEST deduction (see point 3).
If no acquisition costs and date of purchase are reported, Coinfinity must make a lump sum KEST deduction. The same applies if information is classified as implausible as part of the plausibility check. In the case of a lump sum KEST deduction, half of your sale proceeds are assumed as acquisition costs.
Attention: With a lump sum KEST deduction, you are required to file a tax return. The tax tax withheld by Coinfinity is of course taken into account as part of the tax return. Should you need help with your tax return, we are available from Cryptotax by Enzinger gladly available.
If you bought Bitcoin both before and after 01.03.2021 and store it at the same Bitcoin address, the law allows you to choose which Bitcoin you want to sell first. In case of doubt, it is assumed that the Bitcoin purchased earlier is considered to have been sold first.
Even though the regulation appears generous, in order to avoid discussions with the tax office in retrospect, we recommend that, as far as possible, transactions are used on the basis of blockchain transactions that actually have the status of old assets or new assets. In this regard, reference should be made to the “Coin Control” function, which can be used with some Bitcoin wallets (e.g. Electrum, Ledger, Trezor) to select specific inputs (“UTXO”) of a Bitcoin address when sending a transaction.
In this case, you are free to choose which Bitcoin you want to sell on 15.01.2024. If you want to sell Bitcoin from old assets (purchase on 15.01.2021), it is recommended that you use the Coin Control function to select the receipt (“UTXO”) from 15.01.2021 for sale. In this case, there is no capital gains tax. If the Bitcoin from the purchase on 20.01.2022 is to be sold, the receipt (“UTXO”) from 20.01.2022 can be used using the Coin Control function. In this case, capital gains tax of EUR 2,200, - (as in case 1a) is due. In both cases, you still have to inform Coinfinity about the purchase costs and time of purchase.
We hope our contribution helps you understand the mandatory KEST deduction from 2024! For further questions, please contact the tax experts from Cryptotax online for the whole of Austria and at our law firm in the center of Graz we are happy to help you. Just book one Video call with our tax experts and we will help you with your specific case.
Natalie Enzinger has been Austria's leading tax advisor for cryptocurrencies and crypto assets since 2014. As managing director of Enzinger Steuerberatung, she has established herself under the brand Cryptotax specializes in tax advice on cryptocurrencies. In 2022, she founded her second company, questr.io, which focuses on advice on crypto tax tools, data preparation and guarantees of origin of funds.
In November 2023, in cooperation with their two companies, the 1st edition of Austrian crypto tax Guides published - a high-quality, understandable and free information base for the crypto community in Austria.
Disclaimer: This article was created with great care, but only gives an initial overview and does not claim to be exhaustive. This article cannot replace a detailed and individual consultation with a tax expert. Enzinger Steuerberatung GmbH assumes no liability for the accuracy, timeliness and completeness of this contribution.
