Germany's Initiative to Integrate Cryptocurrency into Tax Data Exchange
Germany is taking significant steps to incorporate cryptocurrency transactions and new digital financial products into the international tax data exchange framework. This initiative was unveiled in two legislative proposals that were announced on July 21 and 22, 2026, in the Bundestag. The aim of these proposals is to facilitate the identification of cross-border transactions, accounts, and holdings associated with taxable individuals and companies by financial authorities. The German government justifies this expansion as a necessary measure in the fight against tax evasion and to ensure the security of tax revenue.
The legislative measures are designed to implement two international agreements into German law. The first of these establishes a specific reporting framework for cryptocurrency trading, while the second extends the existing automatic exchange of financial account data to include digital asset forms.
The first legislative proposal pertains to a multilateral agreement established in June 2023 concerning the automatic exchange of information under the international reporting framework for cryptocurrencies. Germany signed this agreement in November 2024 along with 26 other countries. Participating nations are committed to collecting and regularly exchanging tax-relevant information regarding cryptocurrency trading. This framework aims to capture transactions that occur through providers or platforms situated outside the user’s country of tax residency.
The German government describes the automatic exchange of information as a tool against cross-border tax evasion, aiming to integrate cryptocurrencies more thoroughly into the international collaboration that has long been established for traditional bank accounts. The planned exchange will include details regarding the identity and tax residency of users, such as their name, address, country or countries of residence, tax identification number, and date of birth.
In addition, authorities will receive information about the specific cryptocurrency involved and the associated transactions, including the type of cryptocurrency, total gross amounts of transactions, the number of units transferred, and the count of reportable transactions. This data will enable tax authorities to reconcile reported cryptocurrency transactions with the tax returns of the respective users.
Expansion of Financial Account Information Exchange
The second legislative proposal broadens the existing international exchange of financial account data to now include e-money, central bank digital currency, derivatives related to cryptocurrencies, and interests in investment companies that invest in cryptocurrencies. Germany signed the corresponding supplementary agreement in November 2024 alongside 68 other countries, including Mauritius, Rwanda, and South Africa. Other participating nations include the United Arab Emirates, Oman, Brazil, Indonesia, Malaysia, Panama, Singapore, and numerous European countries.
In addition to the previously transmitted account data, additional information will be included. Financial authorities will need to determine whether a valid self-disclosure from the account holder exists, what type of account it is, and whether the account is new, existing, or jointly held. For joint accounts, the number of account holders will also be reported, allowing tax authorities to consider that balances and earnings may not always be fully attributed to a single individual.
The roles of so-called controlling persons of a company or other legal entity will also be documented, clarifying whether an individual exercises control as an owner, beneficiary, senior executive, legal representative, trustee, or managing partner.
The expanded exchange of financial account information is slated to begin in September 2027, with data for the calendar year 2026 being transmitted for the first time, followed by an annual exchange. The agreement between two states becomes effective only when both countries have the necessary laws in place and have deposited the required notifications with the Organization for Economic Cooperation and Development (OECD). Consequently, the data exchange will not occur automatically with every signatory at the same time.
For European Union member states, a pre-existing EU directive serves as the foundation for this initiative. Germany had already implemented these provisions into national law in December 2025. The new legislative proposal now additionally enacts the international agreement.
As reported by fokus-afrika.de.
