Prime Minister Boris Johnson says the UK must prepare for a no-deal break with the European Union unless there is a "fundamental" change of position from the bloc.
The two sides have swapped blame for failing to strike a deal with just weeks until the end-of-year deadline.
Johnson accused the EU of refusing to give Britain a trade deal like the one it has with Canada, which the UK is seeking.
His spokesman went further, saying that the talks are effectively finished.
"The trade talks are over," spokesman James Slack said.
"The EU have effectively ended them yesterday" by stating at a summit in Brussels that the UK would have to significantly change position or there would be no deal.
Reiterating a statement by Johnson earlier, he said that "only if the EU fundamentally changes its position will it be worth talking".
EU leaders insisted they still want a deal - though as European Commission President Ursula von der Leyen said "not at any price".
Von der Leyen said EU negotiator Michel Barnier would head to London next week "to intensify these negotiations".
The UK appeared to rebuff that offer.
"There is only any point in Michel Barnier coming to London next week if he is prepared discuss all the issues on the basis of legal texts in an accelerated way without the UK being required to make all of the moves," Slack said.
Britain toughened its stance and ramped up tension without quite making good on Johnson's threat to walk away from negotiations if a deal was not struck by the EU summit that ends Friday.
"As far as I can see they have abandoned the idea of a free trade deal. Unless there is a fundamental change of approach we are going to go for the Australia solution," Johnson said in London.
Australia has no comprehensive trade deal with the EU.
Johnson's Conservative government insists Britain can still thrive under those conditions, which would mean tariffs and other barriers between the UK and the EU, its biggest trading partner.
But some economists say it would be devastating for many British businesses which are already struggling with a huge economic hit from the coronavirus pandemic.
Britain officially left the EU on January 31 but remains part of its economic structures until December 31.
The two sides have been trying to strike a deal on trade and other relations before then, and say in practice it must be agreed this month if it is to be ratified by year's end.
Despite Johnson's tone, UK Foreign Secretary Dominic Raab said on Friday that gaps between the two sides were narrow.
Raab said differences remained on only two issues: EU boats' access to UK fishing waters and "level playing field" rules to ensure fair economic competition between the UK and the bloc.
"The issues are really narrow now," Raab said.