Bitcoin and Inheritance Tax in Germany

If you inherit bitcoin in Germany, you pay inheritance tax only on the part above your allowance: €500’000 as a spouse, €400’000 as a child, €200’000 as a grandchild. What counts is the euro value of the bitcoin on the date of death, not the purchase price. Inheriting triggers no income tax, and you take over the deceased's holding period. As a rule, you must report the inheritance to the tax office within three months.

This article covers only German inheritance tax. How your family gets to the coins in the first place, with emergency letter, seed and will, is explained in Inheriting bitcoin. Gifts during your lifetime, as well as Switzerland and Austria, are covered in Gifting and inheriting bitcoin: tax consequences. This is not tax advice; for large estates a tax adviser is worth it.

Two taxes, two reference dates

Two taxes meet when you inherit, and each looks at a different date.

1. Inheritance tax on the acquisition itself. It arises with the death (§ 9 ErbStG), and the valuation is made at that moment (§ 11 ErbStG). What the bitcoin once cost does not matter.
2. Income tax, if you sell later. Here the deceased's purchase date and purchase price count (§ 23 EStG). Inheriting itself is not a sale and triggers no income tax.

The first depends on the price on a day nobody chooses. The second you can often avoid by waiting out the holding period.

Valuation: the market value on the date of death

For inheritance tax, bitcoin are valued at their fair market value (gemeiner Wert), the price you would have got by selling on the reference date (§ 12 ErbStG with § 9 BewG). For bitcoin, that is the euro price on a large, liquid exchange on the date of death.

The law names no particular exchange and no time of day. In practice, this works well:

• One traceable source. The daily closing price of a large euro exchange or a well-known price service, with a screenshot or export.
• One source for everything. Don't pick the cheapest exchange for each wallet. That looks arbitrary and invites questions.
• Convert to euros if the source shows only US dollars, using the ECB reference rate of the same day.

Important for holders: the tax is fixed on that one day. Bitcoin can fall by a third in the weeks before the tax assessment arrives. The tax office still uses the value on the date of death.

So plan for it: if you inherit bitcoin and have no other savings, you may have to sell part of it to pay the tax. Whether that sale is itself tax-free depends on the holding period (see below).

Tax classes and allowances

How much stays tax-free depends on how close you were to the deceased. The law sorts heirs into three tax classes (§ 15 ErbStG) and gives each group an allowance (§ 16 ErbStG).

As of November 2026, §§ 15 and 16 ErbStG.

Three points that are often overlooked:

• Every heir has their own allowance. If two children inherit half each, each has €400’000.
• Gifts from the last ten years count too. If the same person gave you something in the ten years before their death, it is added to the inheritance, at its value on the day of the gift (§ 14 ErbStG).
• Spouses and children also get a maintenance allowance (§ 17 ErbStG): spouses €256’000, children up to €52’000 depending on age, nothing from age 27. It is reduced by the capitalised value of survivor's pensions, such as a widow's pension from the statutory pension insurance.

Spouses living in the statutory community of accrued gains (Zugewinngemeinschaft) get a further advantage: the amount they would have received as equalisation of accrued gains in a divorce stays tax-free (§ 5 ErbStG). With a bitcoin holding that grew strongly during the marriage, this can make a big difference.

Tax rates

Above the allowance, a rate applies that rises with the amount. It applies to the whole taxable amount, not in brackets as with income tax (§ 19 ErbStG).

As of November 2026, § 19 ErbStG.

Because the higher rate applies to the whole amount, there would be a jump at every threshold: one euro more would cost thousands of euros more tax. The hardship relief (Härteausgleich, § 19 (3) ErbStG) prevents that. Just above a threshold, you pay the tax of the band below plus part of the amount above the threshold.

Worked examples

All examples assume €80’000 per bitcoin on the date of death, with no other assets and no earlier gifts.

How the value of a holding might develop over the years, and when an allowance gets tight, you can estimate with the calculator. The model is not a forecast:

The holding period passes to you

As an heir, you step into the legal position of the deceased. For income tax this means: their purchase date and purchase price continue to apply for you (§ 23 EStG). The one-year period does not start again.

• Held for more than a year: you can sell immediately, the gain is tax-free. With long-term holders this is almost always the case.
• Held for less: the period continues with you. If you sell before it ends, the gain is taxed at your personal rate, measured from the original purchase price.

If you do have to sell within the period and pay income tax on values that were already subject to inheritance tax, a tax reduction under § 35b EStG may help. That is a case for a tax adviser.

For this to work, you need the deceased's purchase records. Without them, it is hard to show that the period has expired. Also move inherited coins to a wallet of their own, separate from yours. That keeps it clear which coins have which purchase date. How the holding period, the tax-free limit and the order of sales work in detail is in the guide Bitcoin taxes in Germany; how to declare a taxable sale is in Reporting bitcoin gains to the tax office.

Reporting duty: within three months

Every acquisition on death must be reported to the responsible inheritance tax office within three months, counted from the day you learn of the inheritance (§ 30 ErbStG). This applies even if no tax is due in the end. The notification can be informal and contains names, date of death, your relationship and what you inherited, with its value.

There is one exception: if a German court or notary has opened a will from which your relationship to the deceased is clear, the court informs the tax office itself. If the tax office then requests an inheritance tax return (§ 31 ErbStG), the bitcoin belong in it, at their value on the date of death.

Who else learns of the inheritance?

• Banks and custodians report to the tax office what they held for the deceased (§ 33 ErbStG). Bitcoin at an exchange or a custodian are therefore more likely to show up.
• Bitcoin in your own wallet are reported by no one. That doesn't change the duty: they are part of the estate and belong in the return. Leaving them out is tax evasion, and purchase records, bank transfers to exchanges and the public blockchain make it traceable later. What data crypto providers report anyway is explained in DAC8 and CARF explained.

Proving the holdings

With bitcoin in self-custody there is no account statement for the date of death. You have to document the holdings yourself. These have proven useful:

• A list of the addresses or the wallet's extended public key (xpub). With it, the balance on the date of death can be checked in a block explorer without anyone getting access to the coins. Never hand over the seed or passphrase.
• A screenshot of the wallet with balance and date, as soon as you have access.
• Exchange statements for the date of death, for bitcoin held there.
• The price evidence for the date of death, with its source.
• The deceased's purchase records for income tax later.

This is easiest when the deceased prepared: an emergency letter with an overview of the wallets, and a folder with the purchase records. What such a plan looks like is in Inheriting bitcoin.

It gets difficult when the seed is missing and nobody can reach the coins. Whether and how unreachable bitcoin are valued is not clearly settled in law. In that case, document exactly what you tried, and talk to a tax adviser before you file the return.

What may be deducted from the value

Not the whole estate is taxed. You may deduct the estate liabilities (§ 10 ErbStG), for example:

• Debts of the deceased, including income tax still owed, for instance on bitcoin sales in the year of death.
• A bitcoin loan for which coins were pledged as collateral. The coins count towards the estate, the loan is deducted.
• Costs of the funeral, grave care and settling the estate, optionally as a lump sum without individual receipts.

You must pay the tax in euros, usually within one month of the assessment. The law provides deferral mainly for businesses and the family home, not for bitcoin. So keep cash available or plan a partial sale, ideally after the holding period has ended.

Step by step after a death

1. Secure the holdings. Gain access to the wallets without moving coins unnecessarily.
2. Record the price on the date of death. One source, screenshot or export, in euros.
3. Document the holdings. Addresses or xpub, exchange statements, wallet screenshot.
4. Report within three months. Informally, to the inheritance tax office.
5. Collect the purchase records. They decide whether a later sale is tax-free.
6. Plan for the tax. Sell only after the holding period has ended, if possible.