EU chief negotiator Michel Barnier had wanted progress on the exit payment, citizens' rights and the Northern Ireland border issue by October.
The Daily Telegraph has reported this could now slip back to December.
But the Brexit department says next-stage talks are on course for October.
A spokesman for the Department for Exiting the EU said: "Negotiations to leave the EU are under way and we have already made good progress on a number of issues.
"As the secretary of state said, it is important that both sides demonstrate a dynamic and flexible approach to these negotiations.
"Government officials are working at pace and we are confident we will have made sufficient progress by October to advance the talks to the next phase.
"On the financial settlement, we have been clear that we recognise the UK has obligations to the EU and that the EU also has obligations to the UK."
The upbeat assessment followed a report in the Telegraph which said Mr Barnier had told a private meeting of ambassadors that the next phase of negotiations would be delayed by two months because of the wrangle over how much the UK owes the bloc.
The report said Mr Barnier had claimed the EU would not talk about trade or the UK's future relationship with Brussels until "sufficient progress" had been made on the other "divorce" issues.
European Commission spokeswoman Mina Andreeva would not be drawn on what was said at the meeting with ambassadors.
At a press briefing in Brussels she said Mr Barnier had publicly acknowledged that "so far limited progress has been achieved in the negotiations" but EU officials were ready to work on the issues over the summer if the UK side provided further updates.
She said European Commission president Jean-Claude Juncker was committed to engaging with the UK.
"President Juncker has asked, specifically, the task force on Article 50 to be ready every day throughout the coming weeks, throughout the month of August, to engage with our British counterparts should the UK wish to substantiate their position on some of the cases where it has not happened yet," she said.
"The commission stands ready - we are ready to work - and I cannot speculate beyond that on any timetable because that will depend on the pace of the progress being made."

Evans lost his serve just once as he beat Italian top seed Luca Vanni 7-6 (7-5) 6-4, and he will face Israel's Amir Weintraub in the second round.
Ward sent down 16 aces in a 7-6 (8-6) 6-4 win over Canada's Peter Polansky.
Elsewhere, Nick Kyrgios suffered a pre-Open scare when he pulled out of his opening match at the Kooyong Classic.
The 20-year-old Australian handed Belgian David Goffin victory as he retired with a foot injury. He later tweeted that it was precautionary.
The year's first Grand Slam starts in Melbourne on Monday.
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Brexit Secretary David Davis is confident negotiations will continue as planned after reports that Brussels may delay trade talks because of a lack of progress on the "divorce" settlement.
[NEXT_CONCEPT]
Britain's Dan Evans and James Ward both won their opening Australian Open qualifiers to move within two victories of the main draw.