Offsetting Bitcoin Losses Against Stock Gains in Austria

Bitcoin losses and stock gains: what Austrian tax law allows

Anyone in Austria who sells bitcoin at a loss and at the same time realises gains on shares can, in principle, offset the two positions against each other for tax purposes. The Austrian Finance Ministry confirms this expressly: gains and losses from cryptocurrencies held as private assets can be balanced against certain other investment income, including capital gains on shares.

This balancing between crypto and share positions does not happen automatically, however. Anyone holding bitcoin with a crypto platform and shares with a bank will regularly have to use the income tax assessment for it.

A bitcoin loss can reduce a stock gain

A simplified example:

• realised gain on shares: €10,000
• realised bitcoin loss: €4,000
• remaining positive investment income: €6,000
• If both positions are capable of being offset under the Austrian rules, the bitcoin loss thereby reduces the tax base.
• Both taxable bitcoin gains and capital gains on modern shareholdings are in principle subject to the special tax rate of 27.5 percent.

A mere price decline is not enough

What matters is that the bitcoin loss was actually realised. If the price merely falls in the wallet from €60,000 to €40,000, no loss arises for tax purposes in principle. Only a taxable realisation event, for instance a sale for euros, makes the loss relevant for loss offsetting. The same principle applies to shares: there too, a price decline is in principle only realised through a disposal that is relevant for tax.

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