Prime Minister David Cameron had refused to meet the "unacceptable" demand by the original December 1 cut-off, and the new deadline means he will not have to pay before tense general elections in Britain in May.
Osborne said Britain would only pay back half the amount in two instalments next year, because of arrangements involving London's cherished rebate from the EU, but other European sources insisted the amount was the same.
The original bill was based on a recalculation of member states' budgets over several years, but only emerged at a summit in late October, giving Britain only a few weeks to pay up.
France and Germany were set for large payouts under the new rules, while the Netherlands and Italy faced payment demands that were smaller than that of Britain.
A furious Cameron had warned that the budget bill, which emerged suddenly at a summit in October, could cause his increasingly eurosceptic country's exit from the EU in a 2017 referendum.
Osborne said that Britain would only pay 850 million pounds in two instalments in July and September next year, adding that the rest would be offset against a full upfront payment of the 3 billion pounds annual rebate negotiated by premier Margaret Thatcher in the 1980s.
But European sources said the amount of 2.1 billion euros (USD 2.6 billion) -- arrived at after recalculation -- would remain the same for now but that it could be renegotiated after the British elections.
The source added however that negotiations on the amount could be included in talks on the EU's 2016 budget.
Cameron had issued a fresh warning of trouble ahead as the ministers were meeting in Brussels.
You’ve reached your limit of 5 free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →
Smart Quarterly
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Access to Exclusive Premium Stories
Over 30 subscriber-only stories daily, handpicked by our editors


Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share


Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor


Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements


Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app