Bloomberg and other sources have indicated that the change in policy will be officially announced as part of the Conservative government's 2016 budget, which will be delivered on Wednesday, UK time.
Self-driving cars will reportedly be allowed on to local roads this year, with access to high speed motorways and highways being permitted from 2017.
It's not clear whether vehicles in fully autonomous mode will be restricted to certain regions or specific roads within the UK. Nor is it known what regulatory hoops car companies, suppliers and other interested parties will be subjected to.
According to The Guardian, the Treasury has stated, that during the trial phase, lane closures may be required when driverless cars are on the road.
It's understood that both Nissan and Jaguar Land Rover are both keen on testing autonomous vehicle technology in the UK.
Testing of driverless cars on public roads is already under way in the US, Germany and Sweden. Rules vary from country to country, and also from state to state.
In the US, states such as California, Nevada and Michigan permit self-driving car tests on public roads, while in other states the practice is banned entirely. Californian law currently requires the human fall-back driver to be trained and certified in the operation of autonomous vehicles.
In a statement issued over the weekend, George Osborne, Chancellor of the Exchequer, said: "At a time of great uncertainty in the global economy, Britain must take bold decisions now to ensure it leads the world when it comes to new technologies and infrastructure.
"Driverless cars could represent the most fundamental change to transport since the invention of the internal combustion engine."