Undeclared Work Risks 2026
Why paying "under the table" is not worth it - and what you face.
No Insurance Coverage
You are liable as client for accidents
No Warranty
You must fix defects yourself
Fines up to 50,000 EUR
Clients are also penalized
Criminal Proceedings Possible
Tax evasion for larger amounts
Example Fines
| Case | Potential Fine |
|---|---|
| Painting without invoice | 5,000 - 15,000 EUR |
| Bathroom renovation cash | 10,000 - 30,000 EUR |
| Roof work without contractor | 15,000 - 50,000 EUR |
| Regular undeclared work | Criminal proceedings |
Fines vary depending on scope, repetition and federal state.
Consequences in Detail
For Clients (You)
- Fine up to 50,000 EUR for commissioning
- Liability for work accidents
- No warranty for defects
- No tax deduction possible
For Contractors
- Fine up to 500,000 EUR
- Back payment of taxes + social contributions
- Possible trade ban
- Imprisonment for tax evasion
How to Commission Work Legally
Demand an Invoice
Always insist on a proper invoice with VAT shown. Only then do you have warranty.
Check Credentials
Licensed trades (e.g. electrical, plumbing) require a master craftsman certificate. Ask or check with the Chamber.
Deduct Craftsmen Costs
With an invoice, you can deduct 20% of labor costs (max. 1,200 EUR/year) from tax - making legal work cheaper.
Get Multiple Quotes
Compare quotes from several contractors. The cheapest legal provider is always better than undeclared work.
Customs Enforcement Increased!
The Financial Control of Undeclared Work (FKS) customs unit has more staff since 2020 and conducts more inspections - including private construction sites. Suspicious vans and weekend work are checked more often.
Frequently Asked Questions
What is undeclared work?
Undeclared work occurs when services or work are provided without taxes and social contributions being paid. This also includes commercial services without business registration or master craftsman certificate.
What penalties apply for undeclared work?
Clients: Fines up to 50,000 EUR for commissioning undeclared work. Contractors: Fines up to 500,000 EUR, back payment of taxes and social contributions, possible imprisonment for tax evasion.
Do I have warranty with undeclared work?
No. Undeclared work contracts are void. You have no right to repairs or compensation for defects - regardless of what was verbally agreed.
What about insurance for accidents?
Statutory accident insurance does not cover undeclared work. If there is a work accident on your property, you as the client may be liable for treatment costs and damages.
How do I recognize undeclared work?
Warning signs: Cash only, no invoice, significantly below market price, no business registration, no Chamber of Crafts entry for licensed trades.