He admitted he knew that it was illegal to smuggle the gun into the UK and that he knowingly concealed it.
Simon Parry, prosecuting, told Liverpool Crown Court the gun was a "viable weapon" and prohibited in the UK.
The court was also told on Tuesday, May 31 that two laptops and a mobile phone were seized and a search of the devices showed he had “extreme Right-wing views” and an “unhealthy interest in firearms, weapons and proscribed organisations”.
The court heard how Madden told police he would not have used the weapon other than in "extreme circumstances" to defend himself and his wife in the event of a "complete breakdown in society".
Madden also shared videos online through his BitTube channel which included speeches from Adolf Hitler where Jewish people were referred to as "liars" and a "satanic power".
In addition, officers searching his devices found a manifesto by Brenton Harrison Tarrant, the man behind the Christchurch terror attacks in New Zealand.
The gun was discovered by police on Madden's home (Photo: Counter Terrorism Policing North West)
Investigations into Madden's social media use found he had shared emails with a man called Michael Wright in 2017, where he called National Action "the real deal" for people like themselves.
Judge Aubrey added: "It is a neo-Nazi group and you aligned yourself to its beliefs. Such propaganda disseminated by you via social media featured extremely violent imagery and language."
Richard Simons, defending, told the court Madden was "of good character" and had no criminal intent to use the gun.
Addreessing the court, Simons added the gun had also previously been lawfully owned, albeit in a different jurisdiction.
Sentencing Madden to seven and a half years in prison, Judge Aubrey said only an immediate custodial sentencing would suffice due to the "totality of crimes".
Detective Superintendent Andrew Meeks, Head of Investigations for Counter Terror Policing North West said: “Madden had in his possession a 9mm hand gun and significant quantities of ammunition which is a concern to law enforcement and the communities of Merseyside.
“He also admitted inciting racial hatred and holding extremist views which presented him as a threat to wider society.
“The gun and ammunition have now been taken out of circulation and will be destroyed."
Madden admitted possession of a prohibited firearm, possessing prohibited ammunition, two counts of possessing ammunition without a firearms certificate, three counts of possessing an offensive weapon in a private place and possession of a flick knife.
He also pleaded guilty to three counts of stirring up racial hatred but said he did not intend to cause racial hatred. However, he accepted it was likely it would have been stirred up by his actions.
