Make Auto-compounding of Rewards Optional #8
Description
TBD (needs more detail about German accounting)
I’m not an accountant, but AFAIK in Germany crypto is tax-free after holding it for 1 year.
I think auto-compounding is causing some issues here and maybe it would make sense for people who are tax-residences of Germany that they can disable auto-compounding for their rewards.
Maybe it could also make their lives easier when cspr.live would keep track of rewards older than 1 year so they see the amount which is tax free?
Crypto holdings are tax-free if they exceed 1 year of holding.
- Staking rewards need to be considered as income at the moment and at the price at the date/time when they are received and get taxed anyway. There is a threshold for tax-free amount.
- Selling staking rewards after 1 year helps to avoid potential taxes that arise from the increase in price.
If there is a possibility to avoid automatic restaking, this would simplify a lot.
Based on the corresponding Finanzamt (I hired a tax lawyer for my taxes in Germany), it can be an issue if the rewards are restaked when it comes to cut-off date calculation. Imagine they do not understand a lot and even use fax-devices. ;)