The 64-year-old received transfer bonuses in a Monaco account to pull off the £189,000 tax dodge, jurors heard.
One of the payments during his time at Portsmouth was over the £3million profit the club made on the sale of England striker Peter Crouch, prosecutors claim.
The "hard-headed businessman" and former Portsmouth chairman Milan Mandaric were said to have obscured the money trail for years.
Redknapp failed to tell investigators about the Monaco account - named Rosie 47 - as tax officials probed a previous £300,000 payment he received over Rio Ferdinand's record-breaking transfer between West Ham and Leeds, it was claimed.
Details of Redknapp's private financial dealings as a manager were laid bare as the man widely tipped as England's next manager appeared in the dock at Southwark Crown Court.
Opening the case, prosecutor John Black QC said: "The Crown's case is that the money transfers to the offshore Monaco account were deliberately and dishonestly paid by Mr Mandaric, and deliberately and dishonestly received by Mr Redknapp, with the intention of concealing them from the authorities and the payment of tax."
Mr Black said "both parties must have known" they were avoiding taxes.
"These payments were a bung or offshore bonus that the parties had absolutely no intention of paying taxes for," he said.
Redknapp's "widespread popularity" was singled out by the prosecution.
"He is currently enjoying what may be described as footballing success," Mr Black said, referring to Tottenham's current standing as third in the Premier League.
The manager is "unusually talented" and "Harry Redknapp was, it goes without saying, no ordinary employee", he said.
But the barrister added: "Talented and popular he might have been, the Crown say he was nevertheless a hard-headed businessman, with a financial acumen and pecuniary sense of his influence to his employers."
Redknapp first flew out to Monaco - a tax haven - in April 2002 to set up the account, the Crown claims.
He named the HSBC account Rosie 47 - a reference to his dog's name and the year of his birth.
"He flew to Monaco for the specific purpose of setting up a secret account, into which the off-the-record payments could be received," Mr Black said.
Mr Black said the first time the British authorities knew of the Monaco account was in November 2006.
"It's significant, the Crown suggests, that the bank account opened by Mr Redknapp was located in an offshore tax haven.
"The Crown suggests this was quite deliberate and was intended to obscure and to render less transparent the nature of the money payments."
Redknapp and Mandaric deny two counts of cheating the public revenue when he was manager of Portsmouth.
The first charge of cheating the public revenue alleges that between April 1 2002 and November 28 2007 Mandaric paid 145,000 US dollars (£93,100) into the account.
The second charge for the same offence relates to a sum of 150,000 US dollars (£96,300) allegedly paid between May 1 2004 and November 28 2007.
Redknapp initially received 10% of net profit made on player transfers made during his time as part of a clause in his contract, Mr Black said.
But his contract later changed and it was reduced to 5%.
Bonuses paid to Redknapp during his time at the club would total up to £500,000 depending on profits the club made on player transfers, Mr Black added.
Redknapp, appearing behind bullet-proof glass alongside Mandaric, read notes as Mr Black said the sale of Crouch for £4.5million to Aston Villa in 2002 prompted the first payment in to the Monaco account.
Redknapp never declared the account as he was investigated three years later by HM Revenue and Customs investigating over transfer dealings at previous club West Ham, the court heard.
The civil tax probe, between January 2004 and October 2006, "was originally prompted by concerns over a £300,000 payment... regarding profit made in a player transfer, namely Rio Ferdinand," Mr Black said.
The Monaco bank account eventually came to light during a subsequent inquiry into illicit payments in football, led by Lord Stevens, the former Metropolitan Police Commissioner.
In November 2006, Redknapp had been interviewed as part of the inquiry.
"That was the first time anyone heard of a Monaco bank account," the barrister said.
Jurors heard Redknapp gave instructions for the Rosie 47 account to be closed in February 2008 and for the funds to be transferred to his HSBC account in London.
Mr Black said: "What Mandaric and Redknapp said to tax authorities in the UK for a period of four and a half years from the first payment - the short answer is nothing."
Redknapp, who underwent minor heart surgery last year to unblock his arteries, is the most successful English manager in the modern game, having led Portsmouth to FA Cup success and Spurs to last season's Champions League quarter-finals.
Serbian Mandaric, 73, is now chairman of Sheffield Wednesday, having previously worked at Leicester.
The court was adjourned until tomorrow when the opening and first prosecution witnesses will be heard.
