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Accounting & Tax vocabulary · Tax Filing & Compliance

Tax evasion

Meaning in accounting & tax, with examples

nounCommon term

In accounting & tax, tax evasion means: Illegally not paying tax that is owed, for example by hiding income, using false invoices or keeping two sets of books.

In Turkish: vergi kaçakçılığı, vergi kaçırma

How it is used

A criminal offence in most countries, punished with fines and prison. It is different from tax avoidance, which uses the law. People are accused of, charged with or convicted of tax evasion.

Example sentences

  1. The owner was charged with tax evasion after using fake invoices to reduce VAT.

  2. Tax evasion through unrecorded cash sales is a serious problem for many governments.

Common collocations

  • commit tax evasion
  • be charged with tax evasion
  • fake invoices
  • tax fraud
  • tax avoidanceArranging financial affairs within the law in order to pay less tax, for example by using allowances or choosing where to invest.
  • tax auditAn examination by the tax authority of a taxpayer's books, returns and documents to check that the correct amount of tax has been declared and paid.
  • invoiceA document a seller sends to a buyer listing the goods or services supplied, the amount due, any VAT and the payment terms.
  • VATValue added tax: a tax on the sale of most goods and services, collected at each stage of the supply chain and finally paid by the end consumer.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Tax Filing & Compliance

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This page explains English vocabulary for learners. It is not financial advice.