The amount is intended to compensate the MoJ for services carried out in England and Wales between 2005 and 2013 and comprises a cash payment of £75.9m as well as credits for services previously provided of £33m.
Justice secretary Chris Grayling said: “I have been clear from the outset that I would take all necessary steps to recover costs relating to overpayments. G4S’s repayment of £108.9m (plus VAT) represents a significant step forward and a good deal for hardworking taxpayers.”
The agreement follows a review into contracts held by G4S by the MoJ as well as a separate one by the Cabinet Office.
G4S is currently facing an investigation by the Serious Fraud Office.
Ashley Almanza, G4S group chief executive, said that the “way in which the [electronic monitoring] contract was billed was not consistent with the contract or the group's values” and added that the firm has apologised to the MoJ and the government.
He continued: “We have repaid all amounts overbilled and have implemented significant changes to strengthen contract management and controls and to ensure our business is always conducted in a manner which is consistent with our group values.
“We believe that the conclusion of this matter, together with the actions we are developing on corporate renewal, will enable us to maintain our position as a strategic supplier to government."
The repayment comes months after the government appointed former chief executive of construction giant Balfour Beatty, Ian Tyler, to become the crown representative responsible for managing relations between Whitehall and G4S.