Is LIFO allowed for crypto in Germany?
In short: the German tax administration does not allow LIFO for crypto. The law says nothing on it, and the Federal Fiscal Court has not decided the question for crypto assets. What this means for your German tax return.
- The ministry circular (para. 61) allows FIFO for the holding period and average cost or FIFO for the gain. There is no LIFO option.
- The statute (section 23 EStG) has no disposal sequence for crypto. Its FIFO rule covers only foreign currency.
- The Federal Fiscal Court has not decided the sequence for crypto. One tax court has held LIFO permissible.
- We obtained suspension of enforcement against a FIFO assessment at the Berlin-Brandenburg Tax Court (12 June 2026).
- Note: filing on LIFO departs from the tax office. It works only if disclosed, documented and with the assessment kept open.
German terms you will meet
The tax office writes in German. These are the words that matter here.
| German | Meaning |
|---|---|
| Finanzamt | Your local tax office |
| Steuerbescheid | The tax assessment notice you receive after filing |
| Einspruch | Objection: the first step against an assessment |
| Aussetzung der Vollziehung (AdV) | Suspension of enforcement: you do not have to pay the disputed tax for now |
| BMF-Schreiben | Circular of the Federal Ministry of Finance: the tax offices' instructions, not a statute |
| Verbrauchsfolge | Disposal sequence: which of your coins count as sold first |
What the statute says
The law has no disposal sequence for crypto assets.
Section 23(1) sentence 1 no 2 of the Income Tax Act (EStG) taxes the sale of "other assets" if no more than one year lies between purchase and sale. The gain is the sale price minus the acquisition cost and the costs of the sale. If you bought the same coin several times at different prices and sell only part of it, the statute does not say which purchase counts as sold. (§ 23 EStG)
The statutory FIFO rule in section 23(1) sentence 1 no 2 sentence 3 EStG covers amounts of foreign currency. It does not mention crypto assets. For crypto, the sequence rests only on what the tax administration says in its circular.
What the ministry circular requires
Paragraphs 61 and 62 of the circular of 6 March 2025.
| Paragraph | Content |
|---|---|
| 61 | Principle: each unit is traced individually (specific identification). If that is not possible, the units acquired first count as sold for the holding period (FIFO). For the gain, the average method applies, and FIFO may be used as a simplification. |
| 62 | Wallet-by-wallet approach: the method you choose must be kept within the same wallet and trading name until the whole holding is sold. |
| 102, 103 | Documentation per transaction, including the sequence you used per wallet and every transfer between wallets. |
The circular does not offer LIFO. It is neither a substitute rule for the holding period nor an approved simplification for the gain. Source: Federal Ministry of Finance circular of 6 March 2025, ref. IV C 1 - S 2256/00042/064/043.
The circular is an instruction to the tax offices. It binds them, not the tax courts.
What the courts have decided
No ruling of the Federal Fiscal Court (BFH) on the sequence for crypto, but courts that allow LIFO.
-
BFH IX R 3/22Crypto
Every transaction on its own
Currency tokens can be assets under section 23 EStG; purchase, exchange and exchange back are in principle examined one by one. The BFH did not decide on LIFO, FIFO or wallet allocation.
-
BFH X R 49/90Securities
Identity instead of a free choice
For shares held in a collective deposit, the BFH required that the asset sold is identified with the asset bought. It rejected blanket LIFO and blanket FIFO as methods without a statutory basis. The circular itself relies on this ruling in paragraph 61. It does not concern crypto assets.
-
FG Nürnberg 3 K 760/22Judgment 22.01.2025
LIFO for crypto held permissible
In a case we did not conduct, the Nuremberg Tax Court dismissed the claim but held the use of LIFO for crypto assets permissible: the taxpayer had applied LIFO per currency and wallet, and there is no special statutory rule for crypto. The ruling predates the circular of 6 March 2025. To our knowledge it does not address HIFO.
-
FG Berlin-Brandenburg 4 V 4039/26Suspension granted
Our success: suspension of enforcement
By order of 12 June 2026, the Berlin-Brandenburg Tax Court suspended enforcement in a case we conducted. The tax office had applied FIFO where the taxpayer had calculated on LIFO. The taxpayer did not have to pay the disputed tax for now. The question will be decided in the main proceedings. See our case register.
The FIFO, LIFO and HIFO switches that crypto software offers, for example CoinTracking, are not a gimmick. For LIFO there is a court ruling in support, and with our suspension order a court stopped enforcement although the tax office followed the circular and applied FIFO. Anyone who uses a method that departs from the circular can rely on that, but should apply it consistently per wallet and document it (circular, paragraphs 62, 102 f.). For HIFO there is no comparable decision. The question is not finally settled.
Our view: if the BFH already rejects blanket sequences for securities and requires identity, there is much to be said for the view that the tax administration cannot prescribe FIFO for crypto assets by circular alone. That is a legal opinion, not settled law.
How to use this for your assessment
Suspension of enforcement keeps your money until the legal question is decided.
An objection (Einspruch) alone does not stop the tax office from collecting the tax. On application, the office suspends the assessment if there are serious doubts about its lawfulness or if enforcement would cause undue hardship (section 361 AO). If it refuses, you can apply to the tax court (section 69 FGO). That is possible even before you file a claim (BFH VI B 157/97, V B 80/09).
- The bar is lower than many think. A predominant chance of success is not required. It is enough that, on a summary review, weighty reasons speak for both views (BFH V B 80/09).
- Disagreement between courts can be enough. If several lower courts answer an unresolved question differently from the administration, with arguments worth considering, serious doubts can exist (BFH VII B 130/07). The fact that a question is unresolved is not enough on its own.
- What you should know. The tax stays due. If you lose in the end, you pay interest of 0.5% per month (section 237 AO, section 238 AO). If you win fully, no interest is charged.
We do not litigate crypto questions at random. We look for the cases best suited to settle a question and take them to the tax court. As counsel we know the arguments of both sides, and we tell you whether an application for suspension makes sense in your case. We calculate both versions first.
What to do before you commit to LIFO
Three steps.
Calculate both versions
Once as the tax administration sees it (paragraphs 61 f.), once on LIFO. The difference is the amount that would be in dispute. If it is small, the dispute may not be worth it.
Secure your records
Raw exports from every exchange and wallet, transaction hashes and all transfers between your own wallets. Without them you can defend neither an individual allocation nor a different method.
Disclose and keep the assessment open
Name and explain the departure in your return and keep the assessment open by objecting. For the approach see our model objection (German).
Sources
- Section 23 EStG, section 361 AO, section 237 AO, section 238 AO
- Federal Ministry of Finance circular of 6 March 2025, ref. IV C 1 - S 2256/00042/064/043, paragraphs 61, 62, 102, 103
- BFH: IX R 3/22, X R 49/90, IX R 11/13, V B 80/09, VI B 157/97, VII B 130/07
Questions and answers on LIFO for crypto
Is LIFO allowed for crypto assets in Germany?
Is FIFO written into German law?
Has the Federal Fiscal Court decided on LIFO for crypto?
Is there a court decision in favour of LIFO?
Can I apply for suspension of enforcement against my assessment?
Can I file on LIFO anyway?
What do I have to document?
Legal position: 10 October 2026. Sources: sections 23, 361, 237, 238 AO and EStG as cited; circular of 6 March 2025, paragraphs 61, 62, 102, 103; BFH IX R 3/22, X R 49/90, IX R 11/13, V B 80/09, VI B 157/97, VII B 130/07.
Cases: FG Berlin-Brandenburg 4 V 4039/26 (suspension granted). FG Nürnberg 3 K 760/22 is not our case; we know it from a publisher's summary.
The view that the administration cannot prescribe FIFO by circular alone is our own legal opinion. This article is not advice on an individual case. Where this English text and the German text differ, the German text prevails.