Manchester United manager José Mourinho is reported to have reached a deal with the Spanish state over a long-running tax dispute.

Mourinho was accused of owing 3.3million Euros in undeclared image rights revenue for 2011 and 2012, when he was Real Madrid manager – an allegation he disputed.

Spain’s El Mundo newspaper reported he had agreed to pay a fine of 2million Euros .

But Mourinho says he has paid all the taxes he owed. El Mundo also reported that he had accepted a one-year suspended jail sentence.

Sources close to the manager said no prison term had been imposed or accepted.