The £20-a-week Universal Credit increase introduced during the pandemic is expected to bee extended for another six months.
Chancellor Rishi Sunak is expected to confirm the plan in next Wednesday's Budget.
The welfare cash boost was launched last year to help six millions families who were struggling financially following the outbreak of coronavirus.
The rise had been due to run out at the end of March, prompting Labour MPs and backbench Tories to campaign for further help.
A Government source told the Daily Telegraph: "This was a temporary increase to deal with the crisis and has done that job.
"So it makes sense to continue it as we reopen, but supporting people into jobs will be the priority come the autumn."
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But Mr Sunak is also said to have rejected demands to agree to a year-long extension of the increase.
A group of backbench MPs had said that a half-year continuation was too short and "would only push the cliff-edge out by a few months", the newspaper said.
Mr Sunak countered by saying drastic measures could be needed to cover the cost, such as a rise in fuel duty or income tax.
A previous Treasury idea to replace the £20-a-week with a one-off £500 or £1,000 payment was dismissed by Work and Pensions Secretary Therese Coffey
The Universal Credit news comes after it was revealed that the chancellor is planning to extend furlough and other business support until the end of June.
The vital lifelines for many workers had been due to expire on April 30 leaving them facing a bleak couple of months.
Mr Sunak is now expected to announce that he will extend the job support scheme, also in next week's Budget.
Boris Johnson had promised the Government would "not pull the rug out" but gave no details of his plans despite calls for certainty.
But business minister Paul Scully appeared to confirm on Tuesday that economic support would continue for now.
He told MPs: "Given the current climate, it is right that we focus on supporting individuals and businesses through the pandemic.
"In the past, the Government has ensured that businesses and people had that certainty by extending furlough and business grants.
"The announcements at the Budget will... ensure the next phase of our economic support package continues to deliver tailored support."
