The funding announcement, confirmed by Downing Street on Monday, comes as continued opposition to Theresa May's proposed deal makes it increasingly likely that Britain will leave the EU without a deal in March next year.
Chancellor Philip Hammond tweeted earlier this month about the allocation of no-deal funds, which he said would "bolster Brexit preparations."
Ministers are expected to approve the plans at the final Cabinet meeting of the year on Tuesday morning.
A spokesperson for May on Monday confirmed that the prime minister is still prepared to take Britain out of the EU without a deal, despite having warned repeatedly that it would cause significant disruption.
"The closer we get to March 29, the more decisions will have to be taken on ensuring we're ready for a no deal scenario," said the spokesperson.
The prime minister also confirmed on Monday that MPs will vote on her proposed Brexit deal in January after being shelved earlier this month, with the majority of parliament still planning to oppose the deal.
British firms told to prepare for chaotic Brexit
In an unprecedented move, the Cabinet will on Tuesday afternoon tell six million businesses nationwide to start immediate preparations for a no-deal Brexit, the Sun newspaper reports .
Letters to the 145,000 UK firms which export to the EU will be sent to the afternoon, while the country as a whole will be targeted with an information campaign through social media and nationwide advertising.
The government will also lay out their plans the allocation of funding later this week. The Sun reports that the Home Office will reportedly receive 500 million for border and immigration officials, the environment department will receive 400 million for a new IT system and food and fish exports, and the trade department will receive 130 million to hire new trade negotiators to attempt to strike new free trade deals as quickly as possible.
No deal would leave the UK poorer
Several current and former Cabinet ministers, as well as the prime minister herself, have insisted that the UK would flourish under a no-deal Brexit, especially those with designs on the future leadership of a Conservative party with an overwhelmingly pro-Brexit membership.
Foreign Secretary Jeremy Hunt, a frontrunner to replace the prime minister, claimed on Sunday that Britain could "flourish and prosper" outside the EU with no deal. International Development Secretary Penny Mordaunt was also on Tuesday accused by Cabinet rivals of "hypocrisy and dishonesty" for reportedly advocating a "managed no-deal" despite having been previously quiet on the issue.
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But business groups have warned that Britain is highly underprepared to leave the EU without a deal in March. The Confederation for British Industry has said that "leaving the EU in a disorderly fashion would result in disruption for businesses and families, and no deal would leave the UK poorer and less competitive in the long-term."
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