What is tax evasion (Steuerhinterziehung)?
Tax evasion occurs when:
You deliberately hide income or information from the Finanzamt
You reduce your tax liability by providing incorrect data
You fail to submit a mandatory tax return
This is a criminal offense under § 370 of the German Fiscal Code (AO).
| Amount evaded | Possible penalty |
|---|---|
| Small amounts (up to €1,000) | Minor fine or warning |
| Up to €25,000 | Income-based fine |
| Over €50,000 | Very high fine + interest + fees |
| Evasion amount | Sentence |
|---|---|
| Up to €100,000 | Suspended sentence possible |
| Over €100,000 | Serious risk of 1–5 years imprisonment |
| Over €1,000,000 | Usually real prison without suspension |
In addition to fines or imprisonment, you must pay:
Full amount of tax owed
6% annual interest
Administrative fees
Yes, but only if strict conditions are met:
| Condition | Explanation |
|---|---|
| Complete self-disclosure | Must occur before authorities start investigating |
| Covers all years involved | No missing income or errors |
| Full payment of taxes + interest | Must be paid within the Finanzamt’s deadline |
→ If conditions are met: full exemption from criminal charges,
but tax + interest must still be paid.
| Case | Is it evasion? |
|---|---|
| Not declaring rent from a furnished apartment | Yes |
| Freelance work without registration or invoices | Yes |
| Income from abroad not reported | Yes |
| Unintentional late filing | Usually only late-filing penalty |
| German term | Translation |
|---|---|
| Steuerhinterziehung | Tax evasion |
| Selbstanzeige | Voluntary self-disclosure |
| Freiheitsstrafe | Prison sentence |
| Geldstrafe | Financial penalty |
| Steuerfahndung | Tax investigation authority |
| Abgabenordnung (AO) | General tax code |
Never ignore letters from the Finanzamt
Consult a tax advisor if unsure
Keep invoices and documents organized
If a mistake occurs, file a Selbstanzeige immediately
Our editorial team aims for accuracy but errors may occur. Always consult official authorities for definitive guidance.
