David Luiz is seeking a new two-year contract at Arsenal.
The club can propose a temporary extension until the end of the season or activate an automatic 12-month renewal clause inserted into the player's contract.
However, according to the Daily Mail, Arsenal do not want to pay Luiz his £120,000-a-week wages for another season.
The coronavirus pandemic is biting the club's finances hard, prompting a ten per cent pay cut agreed by the vast majority of the squad during football's shutdown.
A new contract on reduced terms may be on the table yet Mikel Arteta's side still favour a single year for the 33-year-old.
