Cyprus: crypto taxes when leaving Germany

• Disposals: Since 1 January 2026, the 8 % substitute tax (Art. 20E) covers sale for fiat money, exchange for another crypto asset, payment with crypto assets, gifting, and returning to the issuing protocol; previously, private crypto gains were effectively tax-free. It covers individuals and companies tax resident in Cyprus; non-residents only through a Cypriot permanent establishment. Mere holding stays tax-free.
• Pre-existing holdings: No grandfathering, no valuation as of 1 January 2026. What matters solely is the timing of the disposal; the entire increase in value is taxed at 8 %. Losses from before 2026 lapse.
• Calculation: 8 % from the first euro; the personal basic allowance works only against general income. Besides acquisition cost, directly attributable incidental costs (exchange commissions, network fees) reduce the gain. Method: Cypriot practice accepts FIFO or specific identification, provided the method is documented and applied consistently.
• Losses: Only against crypto gains of the same year; no carry-forward or carry-back, no offsetting against salary, rent, or other income.
• Current income (staking, lending, liquidity mining, airdrops, mining): Market value on receipt as ordinary income under the progressive schedule of up to 35 %; mining is expressly excluded from the 8 % regime (business income). Through a Cypriot company, the 15 % corporate tax applies instead. The value taxed on receipt becomes the acquisition cost; only the later increase in value is subject to the 8 %.
• Hard forks: No rule of its own; the tokens should be treated like airdrops.
• VAT, wealth, inheritance: Exchanging crypto for fiat, exchanging crypto among themselves, and platform fees are VAT-exempt. There is no wealth, inheritance, or gift tax.

Year of departure

• Unlimited tax liability in Germany only ends once residence and habitual abode are actually given up; the 60-day rule alone isn't enough.
• Cypriot residency: normally 183 days; under the 60-day rule, a stay of just 60 days in the tax year can lead to residency, if the person isn't tax resident for more than 183 days in any other state, holds a permanent home in Cyprus, and shows an economic tie, through a Cypriot company, employment, or a managing-director position, for example.
• Dual residency: for a sale after the German home is given up, there is no domestic income under § 49 EStG; only if both homes still exist in parallel at the time of sale does the tie-breaker matter.
• With substantial hidden reserves, check whether realizing them before emigrating, in the previous state of residence, is more favorable. A loss position brought along only helps if other Cypriot crypto gains arise in the same year.

First year after leaving

• The 8 % rate is comparatively low, but new and still little-tested.
• Example: a gain of €40,000 and a loss of €15,000 in the same year: 8 % on €25,000; in any other year, the loss would be lost.
• Non-dom status (17 years) doesn't exempt from the 8 %; with crypto gains only, it brings no benefit.

More than ten years

• Nothing changes for income tax purposes (current position; changes in law possible).
• If the non-dom regime is used, extended limited income tax liability comes into consideration; it ends ten years after the end of the year in which unlimited tax liability ended. After that, only ordinary limited tax liability remains.
• With no inheritance tax treaty, German extended unlimited inheritance tax liability applies for German nationals if the deceased or donor was fully taxable in Germany within the last five years before the inheritance; after more than ten years, this window is closed.

Moving on to a third country

• According to available sources, no exit taxation of its own; moving on shouldn't trigger tax on unrealized gains. Administrative practice isn't yet settled; get confirmation from a Cypriot tax advisor before a larger move.

Returning to Germany

• No special tax on the Cypriot side. Re-establishing residence or habitual abode in Germany brings unlimited tax liability back; the original acquisition date counts, and a position held for longer than a year in total can be sold tax-free under § 23 EStG.