Philip Hammond has announced that the government will set aside £3bn for Brexit, adding to a £700m sum already allocated.
The chancellor said he is committed to ensuring that the country is "prepared for every possible outcome".
Eurosceptic MPs have been pressing the government to start making plans for a possible "no deal" outcome, and will welcome the funding commitment outlined today.
However, Hammond did not outline how the money would be spent.
Brexit secretary David Davis said this week that he is firmly in favour of striking a comprehensive free trade deal with the European Union, but that it would be remiss of the government not to prepare for every possible outcome.
The UK has been pushing for talks to move onto trade and a meeting of the European Council in December will be crucial to achieving this aim.
The EU is seeking to make sure the UK settles its so-called "Brexit bill" before starting a negotiation on the future relationship.
This week, Theresa May announced that she will be making a new offer on the financial settlement, seeking to break the deadlock in talks in Brussels.