Europe is threatening to keep back Britain’s final rebate payment of €5 billion as part of the negotiations over the Brexit bill, The Telegraph can disclose.

Senior British sources said that negotiations over the bill, which the EU sets at €60 billion (£53.6 billion), had still not settled whether the UK would receive the €5 billion (£4.46 billion) payment as part of the final settlement when it leaves the EU in March 2019.

“There is a problem here, and the issue over whether the EU will pay us the 2018 rebate has not been resolved,” the source in Whitehall confirmed.

The issue of the rebate, won by Margaret Thatcher in 1984, is a key irritant between the two sides as they try to move on to trade talks next month.

Amid testy exchanges on Friday, Europe continued to pile pressure on Theresa May to increase her offer on the Brexit bill beyond €20 billion (£17.85 billion).

Donald Tusk, the European Council president, warned Britain at an EU leaders’ summit in Sweden that “much more progress” was needed on the bill and the Irish border, with British concessions to be delivered “at the beginning of December at the latest”.

He went on to mock David Davis, the Brexit secretary, for suggesting it was time for the EU side to make some concessions. “I can say only that I really appreciate Mr Davis’s English sense of humour,” Mr Tusk said.