Gareth Southgate’s tax affairs clouded plans to knight the England boss if the Three Lions won the European Championships

• Concerns raised over Southgate’s involvement in a ‘film investment scheme’ 
• HM Revenue & Customs (HMRC) considered that the scheme may be illegal
• Even if Southgate led England to victory, his honour could have been questioned

England football manager Gareth Southgate’s tax affairs were the subject of heated debate in Government amid plans to knight him if England had won the European Championships.

The Mail on Sunday can reveal that concerns were raised over Mr Southgate’s involvement in a ‘film investment scheme’ which HM Revenue & Customs (HMRC) has considered may be illegal.

It is understood that even if Mr Southgate had led England to victory, his honour could have been questioned on the basis of a secret memorandum of understanding which exists between the tax authority and the Cabinet Office. It states that ‘poor tax behaviour is not consistent with the award of an honour’.

However, last night, a spokesman for the England manager, who took the team to the quarter finals of last year’s World Cup, insisted that as a ‘proud Englishman’, he had ‘always paid his taxes and complied with HMRC fully throughout his career’.

Concerns were raised over Mr Southgate’s involvement in a ‘film investment scheme’ which HM Revenue & Customs (HMRC) has considered may be illegal. Pictured: Southgate with his wife Alison 

Sources said that when the tax authorities challenged the scheme, Mr Southgate put aside the disputed funds ‘on account’ immediately – even though he was under no obligation to do so.

Winning the Euros in July 2021, would have been England’s greatest achievement since Sir Alf Ramsey’s World Cup triumph in 1966. In the run-up to the match against Italy at Wembley, this newspaper understands that plans were drawn up for Mr Southgate to follow in Sir Alf’s footsteps and be knighted. As England lost the match on penalties, it is understood that the plan was never formally proposed.

Sources said that when the tax authorities challenged the scheme, Mr Southgate put aside the disputed funds ‘on account’ immediately

But the sources say that there had been concerns over the manager’s tax affairs as part of the preliminary discussions.

Mr Southgate was an early member of the film investment schemes operated by Ingenious Media, which HMRC has tried to shut down – despite the company maintaining that its schemes are legal. A Whitehall source said that the England manager had been placed at ‘amber’ on the ‘tax risk list’ –which meant that while his affairs could cause ‘adverse comment’, it did not amount to a lifetime veto.

The source said: ‘If he had actually had won the Euros, it might have been overlooked.’

David Beckham is believed to have had a knighthood blocked in 2014 because of his involvement in the same film investment scheme. The ‘Beckham issue’ is thought to have been raised when Mr Southgate’s knighthood was discussed, with concerns the former England captain might protest that it was one rule for him and another for Mr Southgate.

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