There are claims the UK is prepared to pay €40bn (£36bn) to settle its divorce bill with Brussels - but a senior government source has denied the reports.

The Sunday Telegraph says it has spoken to "three separate highly placed sources" who confirmed a plan in which the UK would pay €10bn a year for three years after leaving the union in 2019.

The newspaper said this would constitute a down payment on a sum which would total €40bn.

Last week, Luxembourg's Prime Minister Xavier Bettel suggested the total bill could be €54bn.

Image: Luxembourg's PM Xavier Bettel suggested the total bill could be €54bn

But the article suggests Britain may be prepared to offer a compromise allowing the two sides to move close to discussing the contours of a future trading relationship.


However, a senior government source told Sky News that the report was "not correct at all".

They said they had "no idea" where the speculation had come from.

Downing Street refused to make any official comment while pointing out negotiations are ongoing.

The EU is insisting "sufficient progress" must be made on the financial settlement, the rights of EU citizens in the UK and British citizens in the EU, together on border issues with Ireland, before talks can progress.

The UK Government has acknowledged it will work towards a "fair settlement" on its "rights and obligations as a departing member state".