BRITAIN wants a pay-as-you-go Brexit as fears grow a trade deal is now impossible before December’s deadline.

Ministers have refused to extend the transition period by two years and want month-by-month membership until an agreement has been reached.

Britain is seeking a pay-as-you-go Brexit deal after refusing to extend the transition period Credit: Alamy Live News

It would avoid paying billions to stay in the single market and keeping the UK tied to European law until the end of 2022. PM Boris Johnson had it written into law that Britain would leave after December 31, with or without a deal.

A source said: “We’re determined to keep our promise.

“There is no way we will commit to a long extension. But in case extra time is needed, we’ve offered to renew the period for a month at a time until the deal is signed and sealed.”

With Europe in lockdown, EU chiefs say thinking a deal can be done is “fantasy land”.

The HQ where officials co- ordinate negotiations is doing only a quarter of normal work.

EU chiefs insist they must know by June if Britain is to seek an extension. Politicians on both sides fear cutting ties without a deal will deepen the chaos caused by Covid-19, which has cost the UK an estimated £50billion so far.

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With extensions into 2021 one month at a time, Britain would pay a proportion of an annual fee to keep trade barriers up.

The source said: “We want to avoid any further turbulence on both sides of the Channel — but we’re clear Britain has left.”

Belgian MEP Kris Peeters said: “You do have to question if it is possible to reach a deal by the end of this year.”

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