Taxes · Filing season 2027
Loss offsetting for options and futures in Germany: the €20,000 cap is gone
Since the 2024 Annual Tax Act (Jahressteuergesetz 2024), losses from derivatives – options that expired worthless, options closed at a loss, futures – can again be offset without limit against all capital income. The repeal of § 20(6) sentence 5 of the Income Tax Act applies to all open cases, including years from 2021 whose assessment can still be changed. Banks only had to apply the new rule in their withholding from 1 January 2026; older losses come back through your tax return.
By Daniel Berg ·
€20,000 cap on derivative losses
Repealed
- Legal basis
- JStG 2024, BGBl. 2024 I No. 387
- Applies to
- All open cases
- Banks must offset from
- 1 January 2026
- Request a loss certificate
- By 15 December
Last reviewed October 2026. General information, not tax advice.
What the 2024 Annual Tax Act changed
From 2021, German private investors faced a special rule: losses from derivatives (Termingeschäfte) could only be offset against derivative gains and option-writing premiums, and only up to €20,000 a year (§ 20(6) sentence 5 EStG, old version). Anything above that was carried forward and again used at no more than €20,000 a year. A second €20,000 cap (sentence 6, old version) hit losses from bad debts and from worthless securities being written off.
The 2024 Annual Tax Act of 2 December 2024, promulgated on 5 December 2024, repealed both sentences (Art. 3 No. 7(c)). § 52(28) sentences 25 and 26 EStG now say the old rules are “no longer to be applied in all open cases”. The separate loss bucket for derivatives is gone: derivative losses are treated like any other capital loss.
| Old rule (2021 until JStG 2024) | New rule | |
|---|---|---|
| Can be offset against | Only derivative gains and option premiums | All positive capital income, including interest, dividends and share gains |
| Annual cap | €20,000 | None |
| Carry-forward | Again at most €20,000 per later year | In full (§ 20(6) sentences 2 and 3 EStG) |
| At the bank | Kept out of the loss pot, offset only in the assessment | General loss pot, mandatory from 1 January 2026 |
The transition rule: banks only had to switch on 1 January 2026
The law applied at once; bank systems did not. In the Finance Ministry (BMF) letter on the flat-rate tax of 14 May 2025, para. 325 says it will not be objected to if banks keep applying the affected paragraphs in their 2022 version for withholding before 1 January 2026. Since 1 January 2026, banks must offset derivative losses in their running withholding without any cap.
Under the old administrative rule, derivative losses never entered the bank’s loss pot. The bank certified them separately without being asked, and they were offset only in the tax assessment (paras. 118, 229a and 233 of the BMF letter of 19 May 2022). If your bank used the transition rule, your 2021–2025 losses sit on the annual tax certificate and do nothing until you claim them in a return.
- From 2026 the bank puts derivative losses into the general loss pot and nets them continuously against premiums, interest, dividends and capital gains.
- Exemption order (Freistellungsauftrag): it is only applied to what remains after the loss offset (BMF para. 230), so a loss can revive allowance you had already used up.
- At year end the bank carries an unused loss into the next year automatically, separately for the general pot and the share pot (BMF para. 233).
Reclaiming losses from 2021 to 2025, step by step
“Open cases” are years whose assessment can still be changed under procedural law. Whether that applies to you depends on where each year stands:
- 1Take stock. For every year from 2021, note: did you file a return? Is there an assessment, and when was it issued? Is it subject to review (Vorbehalt der Nachprüfung) or does it carry a provisional notice (Vorläufigkeitsvermerk)?
- 2Collect the paperwork. Each German bank’s annual tax certificate shows the derivative losses it certified separately under the old rule. For a foreign broker you prepare the figures yourself; see taxes with a foreign broker.
- 3No assessment yet: file a return with Anlage KAP and ask for a review of the tax withheld under § 32d(4) EStG. If you were not obliged to file, the assessment period is four years from the end of the year in question (§ 169(2) no. 2, § 170(1) AO). For 2022 it therefore ends on 31 December 2026; for 2021 it has already ended in that case. A request filed in time keeps the period open until it is decided (§ 171(3) AO). If you were obliged to file – for example because of income at a foreign broker – the period starts later (§ 170(2) no. 1 AO).
- 4Assessment just issued: lodge an objection (Einspruch) within one month of notification (§ 355(1) AO) and submit the losses.
- 5Assessment subject to review: you can apply for a change at any time while the reservation is in force (§ 164(2) AO).
- 6Final assessment without reservation: the case is usually no longer open. Whether a provisional notice on your assessment covers this exact point is stated in its explanatory notes; we could not verify a general provisional notice specifically for § 20(6) sentence 5 (old version) in the Finance Ministry’s publications. Have this case checked.
Made-up round numbers. Single filer, no church tax, assessment still open.
- Derivative losses
- €50,000
- Option premiums
- €10,000
- Dividends, interest, share gains
- €30,000
- Saver’s allowance
- €1,000
1Old rule
The losses may only be set against the €10,000 of premiums. The other €30,000 of capital income stays taxable; after the €1,000 allowance, €29,000 is taxed – €7,648.75 of flat tax and solidarity surcharge. €40,000 of loss is carried forward.
2New rule
The €50,000 loss is offset against all €40,000 of positive capital income. Taxable income: €0. The allowance is not used, because it cannot exceed the income left after offsetting (§ 20(9) sentence 4 EStG).
3Carry-forward
The remaining €10,000 of loss is carried into the next year in full and offset there without a cap.
For a year that is still open, the new rule is worth €7,648.75 in this example – but only if you claim the losses in a return. For the years up to 2025, nothing happens on its own.
Derivative losses on Anlage KAP
Line numbers on Anlage KAP (the capital income schedule) change from one form year to the next; the official instructions for that year are what counts. In substance:
- Income taxed at source (German bank): copy the figures from the annual tax certificate and tick the request to review the tax withheld. Only then does the tax office offset across banks (BMF para. 118).
- Loss certificate: if you requested one under § 43a(3) sentence 4 EStG, the certified losses go into the return. Without a certificate, the tax office does not offset losses that are subject to withholding tax (§ 20(6) sentence 5 EStG, current version).
- Income not taxed at source (foreign broker): you enter gains and losses yourself, with share losses kept separate from other losses.
- Unused losses are assessed by the tax office at year end and carried forward (§ 20(6) sentence 3 with § 10d(4) EStG).
What was not abolished: the share-loss pot and income categories
Losses on shares can still only be offset against gains on shares (§ 20(6) sentence 4 EStG). That reaches options traders through the back door: shares assigned to you on a short put and later sold at a loss land in the share pot – see how option premiums are taxed. Whether this restriction is constitutional is before the Federal Constitutional Court as case 2 BvL 3/21; it is on the court’s list of planned decisions, and no decision had been published when this page was reviewed.
Also unchanged: capital losses cannot be offset against other kinds of income such as salary or rent (§ 20(6) sentence 1 EStG).
Sources and review date
- 2024 Annual Tax Act, BGBl. 2024 I No. 387 – Art. 3 no. 7 (§ 20 EStG) and no. 25 (§ 52 EStG); entry into force under Art. 56(1)
- § 20 EStG – capital income, para. 6 as currently in force
- § 52(28) EStG – application “in all open cases” (sentences 25 and 26)
- BMF letter of 14 May 2025 on the flat-rate tax – paras. 118, 230, 233, 234 and 325 (transition rule); paras. 118, 229a, 233 in the version of 19 May 2022 (BStBl I p. 742)
- § 43a EStG – loss certificate, request by 15 December
- § 32d EStG – flat-rate tax and review request (para. 4)
- § 164, § 169, § 170, § 171 and § 355 AO – reservation of review, assessment period, objection period
Frequently asked questions
Does the abolition of the €20,000 cap apply retroactively?
Yes, to all open cases (§ 52(28) sentence 25 EStG). That includes years from 2021 whose assessment can still be changed – for example because none has been issued, the objection period is running, or it is subject to review.
Do I need to do anything if my bank offsets everything since 2026?
Not for offsetting within one bank. With several accounts or a foreign broker, though, offsetting across institutions needs a loss certificate (request by 15 December) and a tax return. Losses from 2021 to 2025 are claimed through the return in any case.
By when do I have to request the loss certificate?
The irrevocable request must reach the bank by 15 December of the current year (§ 43a(3) sentence 5 EStG). After that, the bank only carries the loss forward internally.
Can I now offset option losses against share gains?
Yes. Derivative losses sit in the general loss pot and can be offset against all positive capital income, including share gains (BMF paras. 118 and 229). The reverse does not hold: share losses remain limited to share gains.
Can I offset option losses against my salary?
No. Capital losses cannot be offset against other kinds of income (§ 20(6) sentence 1 EStG). They are carried forward and reduce future capital income.
Where to go next
All numerical examples in this guide are rounded, illustrative assumptions, not market data. The content is educational and not investment advice. Options are complex instruments; you can lose the entire amount invested, and more than that when selling options.