Ministry of Defence on Saturday denied claims in a leaked memo that up to 16,500 soldiers -- thousands more than originally proposed -- faced the axe of budget cuts.
The internal memo seen by the Daily Telegraph also reportedly showed that 2,500 wounded soldiers, including 350 who have lost limbs, would not be spared in an ongoing programme of defence cuts.
The MoD dismissed the memo as the "factually incorrect" work of a junior officer and said there were no plans to change the level of cuts to the armed forces set out this year.
It also insisted there had been no change in the way it handled injured personnel, saying they were protected from the cuts until they "reached a point in their recovery where leaving the armed forces is the right decision".
The memo emerged as Britain's new defence minister, Philip Hammond, flew back from his first visit to troops in Afghanistan and amid preparations for Sunday's annual national ceremony in honour of the war dead.
An MoD spokesman said: "The information in this leaked army memo from a junior officer is incorrect.
"Beyond those already announced, there are no further army reductions planned. There is absolutely no plan to change our treatment of service personnel who are wounded, injured or sick.
"Personnel injured on operations will not be included in the redundancy process while they are undergoing medical treatment.
"No one will leave the armed forces until they have reached a point in their recovery that is right for them."
Following a defence review last year by the Conservative-led coalition government, the army has been told to cut its numbers by almost a fifth to 82,000 by 2020.
In July, army chiefs warned that an extra 5,000 soldiers faced the axe by 2015, on top of the 7,000 redundancies announced for the first phase, which has already begun.
The classified document quoted by the Telegraph, sent to commanders in Afghanistan, states that wounded soldiers who have been "temporarily downgraded will not be exempt" and could be dismissed in the next round of job cuts early next year.
Jim Murphy, defence spokesman for the opposition Labour party, warned that an accelerated redundancy programme could have "dangerous" consequences and that axeing injured troops would be "the cruellest cut of all".
In the past month, six British soldiers have undergone double amputations as a result of injuries caused by the roadside bombs used by the Taliban, which have accounted for many of the 385 British deaths in Afghanistan since 2001.
An officer serving with a unit in which a soldier suffered a triple amputation this month told the Telegraph the memo had badly damaged morale.
"We now know that not only will we be left with a life-changing injury serving our country over here but we will more than likely be kicked out of the army," he said.
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