Hamilton offered £20million per season

McLaren are set to offer Lewis Hamilton a mega £20million per season contract to remain with the team.

The 2008 Formula One World Champion is out of contract at the end of the 2012 season as his current five-year £15million per season contract comes to an end.

With contract negotiations seemingly ongoing for over a year there has been rumours linking Hamilton with possible moves away from McLaren.

While he appeared out of form and out of sorts during a poor 2011 campaign it was rumoured that McLaren might have been looking elsewhere, while this season various mistakes amongst the team have cost Hamilton points, leading for speculation that Hamilton might take a look around at other options.

In reality the British driver was always likely to remain with McLaren as he has grown up around the team since he was a 13-year-old and leaving the team and everything he has ever known would be tough, but that hasn't put a stop to the media and paddock rumours linking him with Red Bull, Ferrari and Mercedes.

Those links to other teams might still prove crucial as Hamilton's representatives and McLaren team bosses try and thrash out a new deal.

While Hamilton signed a long-term five-year-contract in 2007, it would seem the most likely option this time around would be a three-year-deal with a get-out clause after two-seasons.

The new deal could see a £5million per year improvement on his £15million per season contract, but the Daily Telegraph believe the finer detail is yet to be finalised and could prove to be a sticking point as there will be a lot of negotiations regarding Hamilton’s commercial rights.

Hamilton’s management company XIX Entertainment will argue for more free-time for Hamilton to be able promote his own brands and projects, while McLaren will argue that Hamilton has his own team sponsorship commitments to fulfil.

One way around this could be a lower basic salary to represent this agreement, or Hamilton's team could look to see if other teams were prepared to match his demands to try and budge McLaren's offer.