Crypto Tax Audit: What Evidence the Tax Office May Demand

When the tax office asks about your crypto gains, what decides the matter is not what you experienced but what you can produce. The law requires you to cooperate actively, and it keeps an instrument in reserve for the case where that cooperation fails to appear: the authority then does the calculating itself. This article sets out which documents the tax office may demand, what it bases that on, what applies in addition when your exchange sits abroad, and what happens if you are missing evidence.

The legal basis is found in the German Fiscal Code, the Abgabenordnung or AO for short. These provisions are short, old and unambiguous in their wording, and they apply to bitcoin exactly as they apply to any other asset. The only thing that is new is that the authority has recently acquired a data source it did not have before.

What happens when the tax office asks about crypto?

The standard case is unspectacular and begins with a letter. The case officer reviews your income tax return, comes across income from private disposal transactions and asks for supporting documents. That is not an investigation and not proceedings, it is the normal course of an assessment. How you respond, however, decides what comes next.

Formally this step is called establishing the facts. The authority does not have to work everything out on its own. Section 90(1) AO puts it in a single sentence: "The parties are obliged to cooperate in establishing the facts." In this case, the party is you.

Why the question arises at all

Crypto gains held as private assets fall under section 23 of the German Income Tax Act and therefore count as other income. Unlike with interest or dividends, nobody automatically withholds a tax and reports it onward. The figure in your return therefore initially stands there without any cross-check, and that is exactly what makes it a point where questions get asked. Which amounts your exchange now reports of its own accord, and why the gross proceeds rather than the gain appear there, is something we took apart in September 2026 in a separate article on the reporting obligations of crypto exchanges.

The duty to cooperate under section 90 AO: what you have to supply

The duty to cooperate is the core of the whole thing. The law requires you to disclose the facts relevant for taxation completely and truthfully and to name the evidence known to you. According to the wording of the statute, the extent of that duty depends on "the circumstances of the individual case", which in practice means: the more complicated your case, the more is expected of you.

What matters is the difference between explaining and evidencing. A schedule you drew up yourself in a spreadsheet is an explanation. A bank statement, an exchange export carrying a timestamp or a transaction identifier on the blockchain is evidence. Both are called for, and the schedule on its own rarely carries the day.

The documents that are asked for in practice

The usual request is a compilation per transaction showing the date and time of acquisition, the date and time of disposal, the quantity, the price in euros at both points in time, the fees and the result calculated from them. Alongside that go the raw data from which the compilation was produced: the export files from the trading venues, the bank account statements for deposits and withdrawals, and the addresses of the wallets that held balances.

If part of that is missing, it is not yet a disaster, as long as you disclose what is missing and why. Keeping quiet is the expensive option, because it casts the question in a different light. Which items of evidence specifically carry the one-year holding period is something we worked through in July 2026 in our article on holding bitcoin for more than a year.

Section 90(2) AO: why an exchange abroad increases your obligations

Here lies the point most guides leave out, and for crypto it is the most important one. Where a matter concerns transactions outside the territorial scope of the Fiscal Code, a stricter rule applies. The statute says the parties must "clarify the facts and obtain the necessary evidence", and in doing so must "exhaust all legal and factual possibilities available to them".

This enhanced duty to cooperate in foreign matters bites as soon as your trading venue is not domiciled in Germany. With crypto assets, that is the rule rather than the exception. You then have to obtain the documents yourself, and pointing out that the platform does not answer does not automatically get you off the hook.

The sentence that decides the case

At the end of subsection 2 stands a formulation that reaches further than it appears to at first glance: a party may not rely on being unable to clarify facts or obtain evidence where, "given the circumstances of the case, it could have obtained or secured that possibility for itself when arranging its affairs".

Translated: whoever opts for a trading venue that supplies no usable exports bears the consequences of that decision themselves. Choosing a provider is therefore also a tax decision. Venues under European supervision generally supply complete and properly formatted statements; which ones those are is set out in our comparison of regulated crypto exchanges. The provision itself can be read in the wording of section 90 AO.

Requests for information under section 93 AO and the collective request

The tax office is not restricted to asking you. Under section 93(1) AO, "the parties and other persons" must provide the authority with the information it requires. Persons other than the parties are only to be approached once clarification via you "does not achieve the objective or holds no promise of success". Your cooperation therefore keeps the matter with you.

Alongside that, subsection 1a contains an instrument that looks built for the crypto market although it is older: the collective request for information. With it, the authority may demand information about "a number of matters not yet known to it" involving persons not yet known to it, provided there is sufficient cause. The addressee is then the platform, not the individual user.

What an estimate under section 162 AO means for you

If the documents fail to appear, the matter does not end at all. It merely switches procedure. Section 162(1) AO directs that, in so far as the tax authority "cannot determine or calculate" the basis of taxation, "it shall estimate it". The word "shall" carries the weight here. An estimate is not at the authority's discretion, it is the prescribed consequence.

The triggers are set out in subsection 2. An estimate is made in particular where the taxpayer "is unable to provide sufficient clarification of the information given", refuses further information or "breaches the duty to cooperate under subsection 2". That reference to subsection 2 is precisely the foreign-matters rule from the previous section. Anyone who fails to produce the data from their foreign exchange lands straight in an estimate.

Why an estimate almost always works against you

An estimate has to be coherent and economically reasonable, but it does not have to be cautious. Where acquisition data are missing, it is natural to assume low acquisition costs, and that increases the assumed gain. Equally natural is the assumption that the one-year holding period was not met if the purchase date cannot be evidenced. Both assumptions cost you hard cash, and you rebut both only with the documents that were missing at the start.

The estimate is also not an end point. An objection against the tax assessment is open to you, and if you submit the evidence later, the calculation is redone. That detour costs time, though, often an advisory fee, and in the meantime interest on an additional payment that may have been set too high.

When a field audit is permissible for private investors

The field audit, colloquially the tax audit, is the big brother of the enquiry: an auditor comes to your premises and works through documents covering several years. Section 193(1) AO permits one without any special justification for traders, farmers and foresters, members of the liberal professions and taxpayers within the meaning of section 147a.

For everyone else, meaning the ordinary private investor, subsection 2 names narrower conditions. An audit is permissible among other things where "the circumstances relevant for taxation require clarification and an examination at the offices of the authority is not expedient given the nature and extent of the matter to be examined". A crypto situation branching across several trading venues and wallets can reach exactly that threshold.

The €500,000 line that hardly anyone knows about

Section 147a AO obliges taxpayers whose total positive surplus income in a calendar year amounts to "more than €500,000" to keep the underlying records and documents for six years. Gains from private disposal transactions count as part of that surplus income. Anyone who crosses that line in a strong year thereby also becomes a taxpayer for whom section 193(1) AO permits a field audit without further justification. Where spouses are assessed jointly, the threshold is looked at separately for each spouse or civil partner.

How long do you have to keep the documents?

For private investors below the section 147a AO threshold there is no separate tax retention period. That sounds like a relief and is not one, because the burden of proof stays with you regardless. What governs instead is the assessment period, meaning the window within which a tax assessment may still be amended. For income tax it is four years under section 169(2) AO, five in the case of reckless understatement of tax and ten in the case of tax evasion. Under section 170(2) AO it only starts to run at the end of the calendar year in which the tax return is filed, and at the latest at the end of the third year after the tax arose. For a return you file in 2026, the ordinary period therefore runs until the end of 2030.

In practical terms: keep the documents for a position as long as it can still matter for tax, and for a long-held holding that is a very long time. The purchase receipt from 2018 is the one that in 2026 carries the tax exemption after the one-year period has run. Without it, the position is, in tax terms, an unknown transaction.

What counts as usable evidence

Usable means anything that originates from a third party and carries a point in time. That includes a trading venue's export in its original format, the bank statement for the deposit, the transaction identifier of a transfer on the blockchain and a trading platform's settlement statement. Worth less, but better than nothing, are screenshots with a visible date and your own contemporaneously kept records. How to pull a clean export at an exchange is set out in our article on exporting tax records from crypto exchanges; the tools that turn it into an auditable compilation are in our comparison of crypto tax software.

What to do if the exchange no longer exists?

The case is more common than it should be: a trading venue from the years before European regulation has ceased operating, and the trading data have disappeared with it. The enhanced duty to cooperate then requires you to exhaust every remaining possibility, and there are almost always a few.

Start with your bank account. Deposits to and withdrawals from a trading venue appear there with a date and an amount and give you the time frame. Then check your old mailbox for the confirmation emails exchanges sent for every order. Next, reconstruct the movements on the blockchain itself: every deposit to and withdrawal from an address belonging to you is permanently public and carries a timestamp. Finally, apply the historical euro price for those points in time and record in writing which source it came from.

Disclosure beats estimation

That reconstruction is not full evidence, and it does not have to be. What matters is that you present it to the tax office as what it is: a traceably derived approximation with a disclosed method. Your own reasoned approximation is almost always cheaper than an estimate by the authority, because your assumptions start from what actually happened and not from the least favourable case imaginable.

If in the course of the reconstruction you establish that an earlier return was incorrect, that is a separate matter with its own rules and its own deadlines. What applies there, and where the line to a penalty-exempting voluntary disclosure runs, we described in September 2026 in our article on amended returns and voluntary disclosure for crypto taxes.

Which data your provider passes on anyway

The starting position has shifted. Licensed providers in the EU are subject to a series of reporting and record-keeping obligations, and some of those data reach the tax administration without you doing anything. Which obligations apply to a crypto company under European regulation is compiled in our overview of the MiCA licence and its obligations.

For you, one plain consequence follows. The decisive question now reads differently: does your presentation fit the data that are on file anyway? A discrepancy you explain yourself is a set of facts. A discrepancy the authority finds is a reason for the next question.

How to prepare for an enquiry before it arrives

The effort after the fact is a multiple of the effort in advance, and the difference arises at only a few points. Pull the complete data export at every trading venue once a year and file it unaltered, in addition to any analysis you generate from it. For every wallet belonging to you, note the public address and the point from which you used it. Keep the bank statements showing deposits and withdrawals in the same folder.

Also record in writing which method you use to allocate acquisition costs where you bought identical coins at different times, and stay with that method over the years. A switch in the middle of a holding is the point at which an audit gets stuck. Anyone holding larger balances on their own hardware additionally documents the time of every transfer between trading venue and device; which devices are suitable for that is set out in our hardware wallet comparison.

When advice is worth the money

With a manageable number of transactions on a European trading venue, you will get a long way with a tax program and some care. It is a different matter as soon as foreign elements spanning several years come into play, an estimate is already on the table, business income comes into consideration or an earlier return has to be corrected. In those cases it is about the legal classification and hardly about arithmetic any more; that is a job for a tax adviser.

Crypto tax audits: what to take away

1. Secure the raw data while they still exist. Pull the complete export at every trading venue once a year and keep it unaltered. Today's purchase receipt is the evidence that will carry the tax exemption years from now. Which tools turn it into an auditable compilation is set out in our comparison of crypto tax software.
2. Treat a provider outside Germany as an enhanced obligation. Section 90(2) AO requires you to obtain the documents yourself, and pointing to a silent platform does not get you off the hook. Choose your trading venue partly on the statements it supplies; the selection under European supervision is in our comparison of regulated crypto exchanges.
3. Better to answer with a disclosed approximation than not at all. A reasoned derivation of your own is almost always cheaper than an estimate under section 162 AO, which is allowed to start from the least favourable case. Where the raw data come from when the trading venue no longer supplies them is set out in our article on exporting tax records from crypto exchanges.

(As of September 21, 2026. This article is not investment advice and not tax advice. Prices and fee structures change; check the terms with the provider before you buy.)