The agreement to pay £108.9m plus VAT was disclosed as the FTSE 100 company revealed the cost of the affair had contributed to its slump to a £170m annual pre-tax loss.
It comes four months after ministers rejected a £24.1m settlement offer.
Justice Secretary Chris Grayling said in a written statement to MPs that the sum reimbursed the Government for overpayments made on the tagging contract and to cover costs.
It also includes £4.5m for repayments on two contracts held by G4S for facilities management in the courts, both of which were referred to the Serious Fraud Office in December.
Mr Grayling said it represented a "good deal for the taxpayer" and warned: "In the event of criminal charges being brought we would consider whether further sums are due from G4S."
He added that discussions between the company and the Cabinet Office on "corporate renewal" in the wake of the scandal were not yet complete.
Mr Grayling announced in December that rival Serco would repay £70.5m plus VAT over the tagging scandal.
In a statement confirming the settlement, G4S said the agreed figure comprised a £96.4m refund to the Ministry of Justice plus a reimbursement of costs totalling £12.5m.
It said it had also incurred advisory costs of £5m.
The company said the settlement would be made via a cash payment of £75.9m and credits for services previously provided of £33m.