He became the fifth MP to get a prison sentence since the expenses scandal came to light in 2009.
The 65-year-old was a Labour MP for 18 years and served as Europe Minister during 2002-05 in former premier Tony Blair's cabinet.
Justice Sweeney ruled that MacShane had "deliberately created misleading and deceptive invoices" with considerable dishonesty involved.
MacShane must serve at least half his sentence and he was ordered to pay costs of 1,500 pounds within two months.
Parliamentary authorities began looking at MacShane's claims in 2009 when the wider scandal engulfed Westminster, and referred him to Scotland Yard within months.
But the principle of parliamentary privilege meant detectives were not given access to damning correspondence with the standards commissioner in which MacShane detailed how signatures on receipts from the European Policy Institute (EPI) had been faked.
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