She will meet Michel Barnier in London on Monday ahead of the next phase of talks

Theresa May is facing a race against time to make progress in Brexit talks amid a deadlock over the Irish border.

The Prime Minister is hoping to make a new offer by Friday to satisfy both the Republic of Ireland and the Northern Irish Democratic Unionist Party, which props up her government and scuppered a deal on divorce issues this week.

Pressure is mounting on Mrs May to get leaders at the 14 December European Council summit to declare sufficient progress has been made to pave the way for trade talks to begin, with business chiefs warning companies will activate contingency plans that will cost Britain jobs if there is further delay.

Irish Taoiseach Leo Varadkar and Dutch Prime Minister Mark Rutte have made clear the EU will not compromise and allow the Irish border to be kicked down the road to phase two of the talks, even under threat of Britain crashing out with no deal.

After a phone call with Mrs May on Wednesday, Mr Varadkar said the PM was hoping to return with a new formal written offer "tonight and tomorrow", but warned if there was no agreement talks would be picked up in the New Year.