Expertise — Criminal tax law

Criminal tax law

Criminal tax law exposes any individual or legal entity (private taxpayer, executive, company) to prosecution where a tax audit reveals facts presented as a fraudulent evasion of tax. Penalties range from fines to imprisonment (up to EUR 500,000 and 5 years, increased to EUR 3 million and 7 years for organised-group offences, article 1741 of the French Tax Code). The involvement of a tax lawyer from the audit stage onwards, and a fortiori before any criminal complaint is filed, determines the quality of the defence.

Contact a tax lawyer See the lines of defence
Paris · Geneva · Marseille · Cannes · Lisbon
— 01

Criminal tax proceedings often begin with a tax audit

Criminal tax prosecutions frequently arise after a tax audit followed by a reassessment. On the basis of article L. 228 of the French Book of Tax Procedures, the tax authorities may transmit the file to the public prosecutor, either under the reformed « verrou de Bercy » mechanism (mandatory referral above EUR 100,000 of evaded tax in cases of deliberate breach or fraudulent schemes), or after an opinion of the Tax Offences Commission (CIF) in other situations.

Those exposed include: private individuals (omitted income, concealment of foreign assets), executives, whether de jure or de facto (personal liability for schemes attributable to their management), companies as legal entities (article 1741, paragraph 2 of the French Tax Code), and, where applicable, third-party accomplices (advisers, intermediaries).

An effective defence combines a precise reading of the facts, command of the procedure and a coherent strategy on characterisation, intent and evidence. Acting from the tax audit stage onwards, well before the criminal phase itself, makes it possible to frame the exchanges, secure the procedure and prepare the substantive arguments.

— 02

Four families of tax offences

01

Fraudulent evasion of tax

The core offence (French Tax Code, art. 1741): deliberate failure to file, concealment of all or part of the taxable amounts, or a presentation distorting the tax base.

  • Material element: failure to file, inaccurate return, concealment
  • Intentional element: intent to evade tax
  • Penalties: EUR 500,000 + 5 years (EUR 3 million + 7 years for organised-group offences)
  • Additional penalties: deprivation of rights, publication of the decision
  • Possible combination with administrative surcharges (40-80%)
02

Organised insolvency

Schemes designed to obstruct the collection of tax: asset transfers, creation of shell companies, concealment of wealth (French Tax Code, art. 1742).

  • Disposal or concealment of assets before or during the reassessment
  • Creation of opaque structures intended to place assets out of reach
  • Possible joint and several tax liability of executives and third-party accomplices
  • Possible overlap with the offence of misuse of corporate assets
  • Penalties identical to those for tax fraud (French Tax Code, art. 1741)
03

Fictitious or fraudulent accounting

Keeping inaccurate accounts, false invoices, omitted entries, destruction of records, which may qualify as tax fraud and/or an accounting offence.

  • False invoices (incoming or outgoing)
  • Inaccurate accounting entries intended to evade tax
  • Destruction or concealment of accounting records
  • Possible combination with criminal deception (escroquerie) (French Criminal Code, art. 313-1) in VAT matters
  • Risk of extension to breach of trust or forgery
04

Laundering of the proceeds of tax fraud

A standalone offence (French Criminal Code, art. 324-1) that punishes the recycling of the proceeds of tax fraud. Penalties heavier than for the fraud itself: EUR 500,000 and 10 years.

  • Material element: a transaction intended to conceal the fraudulent origin
  • Intentional element: knowledge of the origin of the funds
  • Penalties: EUR 500,000 (or more) + 10 years of imprisonment
  • Heightened risk for advisers and intermediaries
  • Interaction with TRACFIN and anti-money-laundering obligations
— 03

Five pillars structuring the criminal tax defence

An effective strategy combines early involvement, precise procedural analysis and command of the merits.

Why acting from the tax audit stage onwards is decisive

The criminal tax trial is prepared at the audit stage, sometimes two to three years before the hearing. The statements made to the tax inspector, the documents handed over and the responses to requests from the tax authorities all become elements which, if poorly framed, turn into implicit admissions exploited by the prosecution. A tax lawyer acting from the audit stage structures the defence well in advance: choice of arguments, characterisation of the transactions, securing of positions, preservation of the right to silence in criminal proceedings.

The five pillars of the defence

Early involvement

From the tax audit or the reassessment onwards, to frame the exchanges, secure the procedure and avoid statements that will later be used against the taxpayer in criminal proceedings.

Procedural analysis

Verifying the taxpayer's guarantees (charter, L. 10 LPF), the formalities (audit notice, time limits), the chronology and any irregularities. Any procedural violation may render the procedure, and sometimes the criminal file, null and void.

Building the line of defence

Work on the characterisation of the transactions (business income, non-commercial income, private wealth management), the intentional element (good faith, error of law, advice received) and the consistency of the explanations over time. These elements forge the defence on the merits.

Negotiation and advocacy

An approach calibrated to the procedure and the court. Options include CRPC (guilty-plea procedure), the CJIP (judicial public-interest agreement) for legal entities, or conventional advocacy at trial. Coordination with a possible tax settlement (LPF, art. L. 247).

Managing the consequences

Anticipating the impact of a conviction: publication of the decision, deprivation of civic rights, banking and professional consequences, coordination with administrative penalties (combination of sanctions, ne bis in idem rule, French Constitutional Council, 24 June 2016, no. 2016-545 QPC).

— 05

Lead counsel — François Ouairy

François Ouairy, partner in charge of the Paris office, handles the most sensitive cases at the intersection of tax audits, administrative tax litigation and the criminal tax dimension: preliminary investigations, judicial investigation, criminal court hearings. Recognised by Best Lawyers® 2026 in Tax Law and by Leaders League.

  • Tax fraud (French Tax Code, art. 1741)
  • Reformed « verrou de Bercy » (LPF L. 228)
  • CIF — Tax Offences Commission
  • Laundering of the proceeds of tax fraud
  • CRPC & CJIP
  • Combined administrative/criminal penalties — ne bis in idem
  • Best Lawyers® 2026
  • Leaders League
— 06

Frequently asked questions — Criminal tax law

Who can be prosecuted under criminal tax law?

Any individual or legal entity may be prosecuted: private taxpayers, companies, executives (de jure or de facto), and advisers and intermediaries acting as accomplices. The personal liability of executives may be engaged where the facts are attributable to them, independently of the company's own liability.

What are the most common tax offences?

Tax fraud (French Tax Code, art. 1741): fraudulent evasion of tax through failure to file, inaccurate returns or concealment. Organised insolvency (French Tax Code, art. 1742). Fraudulent accounting and false invoices. Laundering of the proceeds of tax fraud (French Criminal Code, art. 324-1), which carries heavier penalties (10 years).

Why act from the tax audit stage onwards?

The criminal trial is prepared two to three years before the hearing, at the audit stage. Statements made to the tax inspector, documents handed over and responses given, if poorly framed, become incriminating evidence exploited by the prosecution. Early involvement makes it possible to structure the defence in advance, secure the procedure and preserve the strategic options (settlement, CJIP, CRPC).

What is the reformed « verrou de Bercy » mechanism?

The mechanism under which the tax authorities decide whether or not to transmit a file to the public prosecutor (LPF, art. L. 228). Since the law of 23 October 2018 (on combating fraud), referral is mandatory above EUR 100,000 of evaded tax in cases of deliberate breach (40%) or fraudulent schemes (80%). Below that threshold, the Tax Offences Commission (CIF) is consulted.

Can administrative and criminal penalties be combined?

Yes, subject to the ne bis in idem principle as interpreted by the French Constitutional Council (24 June 2016, no. 2016-545 QPC) and the European Court of Human Rights. Combination is permitted in the most serious cases and provided the sanctions are coordinated in a manner respecting fundamental guarantees. The administrative surcharge is set off against the criminal fine where both are effectively applied.

Is a CJIP available in criminal tax matters?

Yes, since the « Sapin 2 » law of 9 December 2016 (extended to tax fraud by the law of 23 October 2018). The CJIP (judicial public-interest agreement) allows a legal entity to reach an agreement with the public prosecutor without any admission of guilt, in exchange for a public-interest fine, a compliance programme and, where applicable, compensation. A powerful tool for companies, to be considered systematically.

Cité par

Criminal tax proceedings under way or anticipated?

Describe the context (audit in progress, reassessment notified, criminal complaint feared) so that the defence strategy can be assessed and an initial discussion arranged within 24 hours. Timing is decisive: every statement and every document handed over counts.

Contact the firm See François Ouairy's profile

© BENSAID Avocats. The information published on this website does not constitute legal advice. French Tax Code art. 1741, 1742, 1743, 1745. LPF art. L. 228, L. 230. French Criminal Code art. 324-1. Law of 23 October 2018 (reformed « verrou de Bercy »). « Sapin 2 » law of 9 December 2016 (CJIP). Editorial update: April 2026.