How am I taxed?

Automatic taxation covers all transactions in Invest and CFD accounts that generate capital gains. This includes:  

• Selling stocks and ETFs
• Closing CFD positions
• Receiving dividends
• Receiving interest on cash
• Credited overnight interest

Generally, no. We automatically deduct all capital gains taxes and report them for you. However, individual tax situations vary. Please consult your tax advisor if you have questions.

You can find your paid taxes, offset pots, exemption order, and all tax-related transactions in the tax overview. 

1. Go to Settings
2. Select Tax overview

Yes, you will find the annual tax certificate in the tax overview in the following year. We will let you know once it is ready.

If you are a German tax resident registered under Trading 212 FXFlat, we automatically apply the following taxes:

• Capital gains tax: 25% of taxable gains
• Solidarity surcharge: 5.5% of the capital gains tax amount
• Church tax: 0%, 8% or 9% depending on your church membership and the state you live in

We obtain your tax ID automatically from the Federal Central Tax Office based on the information you provided during onboarding. We use this tax ID to retrieve your church tax status. If we have not received the tax ID from the tax office, you can manually add your tax ID in the tax overview. 

As a German tax resident, you have an annual tax-free allowance for capital gains (“Exemption Order”).

• Individuals: €1,000 per year
• Married couples / Registered civil partnerships: €2,000 per year

You can set up an exemption order directly in the tax overview. You can find more information here.

Loss pots track your realised investment losses. We use these losses to offset your profits, ensuring you only pay tax on your net profit. 

For offsetting profits and losses, we maintain two pots for each account as required by German tax law:

• The stock loss pot
• The other loss pot

The stock loss pot tracks realised losses from selling stocks. We can only use these losses to offset profits from other stock sales. We cannot use them to offset profits from ETFs, CFDs, or dividends.

The other loss pot tracks realised losses from all transactions except stock sales (e.g., losses from ETFs or CFDs). You can use these losses to offset any type of profit, including stock sales, dividends, and interest on cash.

We use losses to offset profits in the sequence defined by German tax law.

• Stock losses
• Other losses  

If the loss pots have a remaining balance at the end of the year, you have two options:

• Carry-over to the next year: We automatically carry over your losses into the next year to offset future profits with Trading 212. No action needed.
• Request a loss certificate: If you request a loss certificate, the loss pots are reset to zero at the end of the year, and you can use the losses to offset profits from other brokers in your tax declaration. You must request the loss certificate by December 15. You can find more information here.

• When you receive income from foreign investments (for example, dividends from a US company), the source country often retains a portion of the income as withholding tax.
• To prevent you from being taxed twice (once in the source country and again in Germany), we track these foreign taxes in the Withholding Tax Pot.
• We automatically credit the eligible foreign taxes you paid against your German tax bill, up to the legal limit. The exact amount we credit depends on the double taxation agreement between Germany and the source country.

When you realise a profit from investing, we follow a specific order to determine your taxes.

1. Calculate capital gains: We determine the profit using the FIFO method (see below), considering any transaction fees and taxes.
2. Apply partial exemptions (Teilfreistellung): In some cases, a part of the profit is tax-exempt. This applies, for example, to ETFs that mainly invest in stocks. We apply these exemptions automatically.
3. Offset with previous losses: We use the applicable losses in your loss pots to offset the remaining profits (see loss pots section).
4. Apply the exemption order: We use your remaining exemption order volume to reduce the taxable profit.
5. Calculate the taxes: We apply the taxes (Capital Gains Tax, Solidarity Surcharge, and Church Tax if applicable) to the remaining taxable amount.
6. Credit foreign withholding tax: We automatically apply the amount in your foreign withholding tax pot up to the legal limit to reduce your German capital gains tax.  

German tax law requires the FIFO method. This means we assume the shares you bought first are the ones you sell first. To determine the profit, we compare the sell value to the acquisition cost of the shares that you sold. The acquisition price and the sell value considers any fees and transaction taxes. 

We can not deduct taxes automatically for income that is not classified as capital gains under German tax law. This may be the case for some physical ETC and applies to Profits generated solely from currency exchange rate fluctuations on our multi-currency account.

You may need to declare this profit manually. Please consult a tax advisor if you have questions.

Since our tax automation goes live on January 5, 2026, we will not process the Vorabpauschale for the 2025 tax year. You will need to declare this on your personal tax return.