Football League clubs will be barred from signing new players if they breach regulations on tax payments. Any club which falls behind with payments will be subject to a transfer embargo until the debt is cleared as the League attempts to make its members more prudent.

Football League chairman Lord Mawhinney said: "It is only right we do not permit clubs that are unable to meet the costs associated with their existing playing staff to make further new player commitments."

Clubs have also agreed to give the League written permission to monitor their tax affairs directly with HMRC, who have welcomed the new arrangement.

Mawhinney added: "This new regime will provide us with an early warning system where clubs are facing financial problems.

"It should also help prevent HMRC debt reaching levels that otherwise could hinder the potential rescue of the club through a CVA.

"More importantly, football generally needs to develop a culture of paying its debts rather than putting them off for another day. This will help our clubs to become more financially sustainable in the longer term."