Information request
What can the tax office request – with regard to cryptocurrencies?
The request for information – An overview from the experts at Kryptoanwalt.de
Information request from the tax office
Information requests are inquiries from the tax authorities aimed at obtaining information to clarify or verify a taxpayer's tax situation. In the world of cryptocurrencies, such requests can be particularly extensive and complex, as transactions are often anonymous and decentralized. This article explains what information the tax authorities can request in connection with crypto transactions and how taxpayers should respond.
Possible requirements of the tax office
Transaction history
The tax office can request detailed records of all cryptocurrency purchases, sales, and transfers. This includes the date, amount, price, type of cryptocurrency, and the platform on which the transactions were conducted. This information is crucial for accurately determining the amount of any profits or losses.
Documentation of wallet addresses
Taxpayers may be required to provide proof of the wallet addresses they use. This may also include proof of the origin of the funds (e.g., purchase receipts, trading history) to confirm the legitimacy of the transactions.
Crypto exchanges and platforms
If you buy or sell cryptocurrencies through exchanges or trading platforms, the tax authorities may request information about your accounts and related trading activity. This could mean providing copies of account statements or reports from the platform.
Revenue from crypto services
If you have generated income through crypto-related services, such as mining or staking, the tax authorities will also request information. This may include documentation of the income earned, related expenses, and a precise calculation of profits.
Proof of the use of cryptocurrencies
The tax office can also request information about how and for what purpose you have used your cryptocurrencies. This includes, for example, expenditures or payments in cryptocurrencies and how these comply with tax regulations.
Response to information request
Fast and complete processing
Upon receiving a request for information, it is important to provide all requested information quickly and completely. Delays or incomplete information may lead to further questions or potentially to disadvantages.
Keep documentation
Carefully record all relevant transaction documents. This will not only facilitate responding to information requests but can also be helpful when preparing your tax return.
Seek legal advice
If the tax office's requirements seem unclear or burdensome, it is advisable to seek legal advice from a lawyer specializing in crypto law. We can help you understand the legal framework and ensure that all required information is provided accurately and in accordance with legal regulations.
Conclusion
In connection with cryptocurrencies, tax authorities can impose extensive requirements for documenting transactions and income. Taxpayers should be prepared to provide comprehensive evidence of their crypto activities. Careful documentation and, if necessary, seeking legal advice are crucial to successfully complying with tax authority requirements and avoiding potential tax issues. Understand the tax authorities' requirements and regulate your crypto activities accordingly to be well-prepared.
This information serves as general guidance and cannot replace individual tax advice from our experts. Tax treatment may vary depending on your specific situation and current tax regulations. It is strongly recommended that you contact our lawyers to clarify your personal tax situation and ensure compliance with legal requirements.