The Chilean has been found guilty of tax fraud committed during his time with former club Barcelona.
Sanchez defrauded the Spanish government of around €1million in tax between 2012 and 2013 by falsifying the sale of his image rights to a foreign company.
The 29-year-old ,who gave evidence to the Spanish court via a video link while he was an Arsenal player last year, has accepted a suspended sentence and has reached an agreement where he will repay the money owed, plus any interest.
He has two years to repay the full amount before the sentence is lifted, and he will be forced to spend time behind bars.
Sanchez is the latest high profile player in Spain to have been prosecuted for alleged tax evasion.
Lionel Messi was given a 21-month suspended sentence in 2016 — before it was changed to a £223,000 fine last year, while Javier Mascherano was given a one-year suspended prison sentence in 2016 and hit with a £610,000 fine.
Real Madrid midfielder Luka Modric alaso paid £880,00 to Spanish tax authorities to avoid spending time in jail.
Meanwhile, Cristiano Ronaldo continues to plead his innocence having been accused of defrauding the Spanish government of £13million in unpaid tax.