An Australian official says Australia hopes to send thousands of Iranian asylum seekers back to their homeland under a new deal with Tehran.

The West Australian newspaper reported on Wednesday that Foreign Minister Julie Bishop's negotiations with her Iranian counterpart Javad Zarif were well advanced on a deal expected to be signed next week that would lift Tehran's long-standing refusal to accept Iranian asylum seekers who don't want to come home.

Bishop's spokeswoman Rachel Obradovic confirmed that the newspaper report was accurate.

Under the repatriation agreement expected to be signed by Zarif when he visits the Australian capital Canberra on Tuesday, Australia would demand guarantees from Iran that Iranians who return home would not be persecuted or punished.

The Iranian policy change could cover almost 9,000 Iranian asylum seekers.