Redknapp was the strong favourite to fill a post he had long coveted when Capello resigned in February last year, only for the Football Association to appoint Roy Hodgson.
The 66-year-old QPR manager, who was sacked by Tottenham in June after failing to agree a new contract, believes the cost of luring him from White Hart Lane convinced the FA to look elsewhere.
"I wouldn't take it [the England job] now, no. Not now, not in the future," Redknapp told Twentyfour7 Football magazine.
"That was my time, really, if I was going to get it. Last year there were a lot of things that went against me surrounding that massive contractual clause.
"People will always deny that is the reason, the FA couldn't say that and I won't say, but it didn't help me.
"I had such a badly loaded contract it was crazy, in Tottenham's favour. That's what you get for not reading your contract properly.
"It was a massive amount that someone would have had to pay to get me out of it.
"If they sacked me it wasn't so massive and that was a bolt out of the blue, a shock, I genuinely never saw it coming."
Redknapp insists Tottenham's decision to sack him was made by owner Joe Lewis and not chief executive Daniel Levy.
"Was it Levy who cut the cord? It was other people, the owner of the club that decided," he said.
Redknapp took over at QPR late last year but has been unable to steer them clear of relegation trouble, with eight points currently between them and safety.
The manager has vowed to stay at Loftus Road even if they do go down this season.
He added: "I'd stay with the club and have a go at it. But it is so difficult to go back up. There are some decent teams in the Championship.
"I know I should be preparing but I don't even want to think about it."