The team is aiming to offer the 22-year-old Norwegian what it feels is the best chance possible of winning the IRC title next season.
Neither Mikkelsen or Skoda UK were prepared to comment on the agreement, which was further discussed during last week's Cyprus Rally and IRC awards evening in Limassol.
A list of drivers including Alister McRae, Mark Higgins and Adam Gould were being considered, but it is believed Skoda Motorsport was keen on Skoda UK employing what it saw as the fastest driver in the field. The seat in the Skoda UK Fabia S2000 for next year's IRC was made available when Guy Wilks signed to drive for Peugeot last week.
A source close to Skoda UK Motorsport said: "There will be a close involvement with Skoda Motorsport next season, closer than ever, actually. The Skoda UK team was mindful of this and the Czech Republic pointed out that someone like Andreas Mikkelsen would be able to offer an immediate rally-winning driver."
Mikkelsen, who won Sunday's inaugural Golden Stage Rally in Cyprus, is expected to contest 10 rounds of the IRC next season with the Skoda UK team, running in precisely the same car as the Skoda's IRC champion Juho Hanninen and his team-mate Jan Kopecky.
The fifth Intercontinental Rally Challenge was the best yet, and it was Skoda UK driver Andreas Mikkelsen who emerged as champion from a tense five-way shootout at the season finale. Matt Beer reviews the season