An insider told The Sun that Palmer, best known for roles in As Time Goes By and Butterflies, is " one of Britain's best loved telly actors so it's a real coup to get him on board. He has starred in the show before, back in the Seventies, and is a big fan".
Palmer featured in two stories opposite Jon Pertwee, the third incarnation of the Time Lord, appearing in the 1970 adventure 'The Silurians', followed by 'The Mutants' two years later.
However, that is not his only connection to the hit time-travelling drama as his son Charles recently directed several episodes during the show's third season.
Palmer joins Kylie Minogue and fellow comedy actor Clive Swift in the festive offering of Doctor Who, entitled 'Voyage of the Damned'.