Tax fraud, also known as “tax evasion” or “tax avoidance”, is the non-compliance with tax obligations by natural persons or entities, in order to pay less taxes than legally corresponds to them.

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Characteristics

These are some of its characteristics:

• It represents a loss for the Public Treasury.
• It goes against tax regulations or uses or interprets them incorrectly.
• The “defrauder” does not comply with their tax obligations.

Types of tax fraud

Article 305 of the Criminal Code establishes that frauds against the state, regional, provincial or local Public Treasury are:

• Tax evasion, retained amounts or amounts that should have been retained from in-kind compensation.
• Improper obtaining of refunds.
• Enjoying benefits in the same way.

Tax fraud as a crime

The Spanish Criminal Code regulates in its title XIV of Book II (articles 305 to 310), the “Crimes against the Public Treasury and against Social Security”.

It is necessary that the amount of the defrauded quota, the amount not paid of withholdings or payments on account, or of refunds or tax benefits improperly obtained or enjoyed exceeds €120,000. Below this amount, an administrative offense will be committed.

Prescription of tax fraud

Prescription depends on the type of fraud:

• The administrative offense prescribes after 4 years.

• The general tax crime will be one that has involved a fraud of more than €120,000 of quota. The prescription would be after 5 years.

• The aggravated tax crime is one in which the amount of the defrauded quota exceeds €600,000 or the fraud has been committed within an organization or criminal group. The prescription would be after 10 years.

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