The visitors made a confident start on City legend Vincent Kompany's return to the Etihad Stadium, pressing high up the pitch.
However, Haaland opened the scoring after 32 minutes, latching onto a perfectly weighted Alvarez pass to poke in.
Three minutes later, our number nine claimed his 41st goal across all competitions this season, connecting with Phil Foden's accurate cross to find the bottom corner.
Shortly before the hour mark, the 22-year-old completed his hat-trick, pouncing to tap in after Foden's shot rebounded off the post, claiming sixth treble for the club and his eighth goal in two matches.
Three minutes later, Alvarez added a fourth goal, tapping in from Kevin de Bruyne's cut-back to finish off a free-flowing move.
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Substitute Palmer made it five, reacting quickest to finish on the rebound after Bailey Peacock-Farrell parried a shot, before Alvarez doubled his tally by blasting into the roof of the net.
The victory takes us into the last four of the FA Cup and another trip to Wembley Stadium!
View the best images from the win via our gallery below.