A cabinet source told the BBC that the document has been agreed at a technical level by officials from both sides after intensive discussions this week.
A special cabinet meeting will be held at 14:00 GMT on Wednesday as Theresa May seeks ministers' backing.
The PM is meeting ministers in Downing Street for one-to-one talks as they are given sight of the draft agreement.
The pound surged against the dollar and the euro - but analysts warned it could be short-lived, with the cabinet and Parliament yet to agree to the plans.
The EU said it would "take stock" on Wednesday, and the Irish government said negotiations were "ongoing and have not concluded".
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