A German newspaper has reported that the sum would bring Germany's contribution to the agency to 1.5 billion euros. The paper added that Chancellor Merkel would announce the additional funding at a London conference.
German newspaper "Rheinische Post" reported on Wednesday that the German federal government will boost its funding contribution to the UN High Commissioner for Refugees (UNHCR) by 500 million euros ($546 million), citing government agencies.
The sum would reportedly bring Germany's total contribution to the UNHCR - commonly referred to as the UN Refugee Agency - to some 1.5 billion euros, according to the newspaper.
As of last September, Germany was ranked the ninth highest contributor to the UN agency, donating some 60 million euros to its 2015 budget.
The "Rheinsiche Post" said German Chancellor Angela Merkel would make the announcement during a conference in London aimed at bolstering financial support for those affected by the Syrian conflict.
The conference is set to take place on Thursday, with heads of state and ministers from countries across the globe expected to be in attendance.
While taking place in London, the conference is co-hosted by the UK, Germany, Kuwait, Norway and the UN.
Germany witnessed more than one million migrants enter the country in 2015, the majority of them fleeing war-torn countries in the Middle East, Asia and Africa in hope of obtaining international protection through asylum.
The German chancellor has come under increased political pressure from allies and opposition lawmakers for her open-door policy towards refugees, many of which are Syrians fleeing a conflict that has killed more than 250,000 people and displaced half the population.
Meanwhile, Merkel on Saturday told members of her Christian Democratic Union (CDU) party that they needed to tell refugees their situation was temporary, and they are expected to return home "once there is peace in Syria again."
ls/kms (Reuters, dpa, epd)