# Taxes on shares

I am wondering about an aspect of taxes on shares. What exactly is taxed? How is the fee of my bank factored in? (Is it at all?). I am asking specifically for the German take on this, but I assume this is done more or less the same everywhere.

Assume I buy 10 shares from company X at a price of 10€ each. My bank (and/or stock exchange) charge me in total 10€ in fees. So after all, I have now 100€ value in shares for which I payed 110€.

Now assume I sell these shares after their value went up. Let's assume that I sell them for a price of 11€ per share. So I get 110€ for my shares. Anyhow, again, I am charged 10€ in fees.

So how is this taxed?

On the one hand, I made 10€. On the other hand, I payed 2*10€ in fees. Are the fees subtracted from what I "earned"?

• In the first case, the state assumes that I made 10€ and taxes me on that - even though I essentially lost 10€. So - assuming ~26% taxes - I lost 12,60€.

• In the second case, the state acknowledges that I lost 10€ - and I don't get to pay any taxes.

Or, in other words:

If I buy shares in 2020 for `A €` and pay `B €` in fees for this transaction, then go and sell everything in 2030 for `C €` and pay `D €` in fees, what exactly is going to be taxed?

1. (C-D)-(A-B)? Sounds fair and reasonable to me.
2. C-A? Not so nice depending on the fees.
3. A-B? Nightmare. Doesn't take into account that I had to spend money to buy the shares in the first place.
4. A? Nightmare plus I get to pay the fees on top.
• This will be very jurisdiction specific, relating to the specific rules about taxes on capital gains. May 21 '19 at 11:18
• I wonder if there is any jurisdiction where the end answer is not `C-(D+A+B)`, though the precise terminology that leads to this result may vary from place to place. (This is not among the OP's option, though I suspect it was what he meant to write in (1)). May 21 '19 at 11:42