AN historic deal to transfer new tax powers to Holyrood is “within reach” and could be sealed as early as today, Whitehall sources have suggested.

After months of negotiations between London and Edinburgh, it appears that if some “quibbling over some details” can be sorted out both camps could announce an agreement this morning.

Deputy First Minister John Swinney and David Mundell, the Scottish Secretary, are due to appear before MSPs on the Scottish Parliament’s Further Powers Committee.

A deal today would allow both MSPs and peers, who are due to hold the report stage of the Scotland Bill tomorrow, to discuss the details of the deal in both parliaments this week.

During a debate on the bill in the House of Lords yesterday, Lord Dunlop, the Scotland Office minister, told peers that talks were at a "sensitive and critical point," that "significant progress" had been made.

While nothing was certain, he said "a deal now seems within reach".

Asked later if an agreement was imminent, a senior Whitehall insider said: “I hope so; we’re still quibbling over some details,” while another stressed there were “positive feelings”.

Last Friday Mr Swinney and Greg Hands, the Chief Secretary to the Treasury, met for the tenth time to discuss the fiscal framework, the mechanism by which Holyrood’s new powers on tax and welfare will be introduced.

It emerged that closeted in the talks was Chancellor George Osborne, who is said to have brought focus to the negotiations.

The details of any deal are unknown but will have had to have squared the circle regarding Scotland’s future revenues and how to reduce the £30 billion annual Scottish block grant as the tax powers are introduced in Edinburgh.

Neither Whitehall nor Holyrood have been able to agree on the right mechanism. The former has been battling for one particular option, which it believes would be fair to Scotland and the rest of the UK as the population south of the border is due to grow twice as fast in the coming years as that north of the border.

But Holyrood believes this option would leave Scotland £7bn out of pocket over the next 10 years.

Whitehall suggested what it called a “compromise option”, whereby the UK would take on some of Scotland’s population risk, but this, claimed Mr Swinney, would still leave Scotland £3bn short. The SNP government is adamant it will not see a revenue cut “embedded” into Scotland’s future finances.

The UK Government has insisted “no detriment does not mean no risk” and that taxpayers in the rest of the UK should not have to bear unfairly the burden and pay more to sustain Scotland’s public finances when spending per head north of the border is already £1200 a year more than in England.

In the Second Chamber, Lord Forsyth of Drumlean, following a demand from the UK Government and Labour, withdrew his call for the final day's committee stage debate on the bill to be delayed until the fiscal framework was published.

The former Conservative Scottish Secretary likened talk of an agreement to "Billy Bunter's postal order; it's always coming tomorrow".

Labour former chancellor Lord Darling of Roulanish said the framework was the most important part of the Smith settlement and it was "deeply regrettable" Westminster still did not know what was in it.

But he warned it would be a mistake for the Lords to delay the legislation and urged ministers to ensure peers would have the framework by report stage on Wednesday.