Among the billing errors, one customer received bills for £109.77 from TalkTalk after she switched to another provider. She was given no assurances that it would stop sending her bills even after spending more than an hour on the phone trying to resolve the problem.

Another customer paid Tiscali UK £610 despite cancelling her account in February 2006, after being sent bills from debt collection services.

Under chief executive Dido Harding, TalkTalk has created a central support team to improve service quality and rectify the problems.

It said: "We're pleased that Ofcom has recognised the significant steps we've taken to fix the billing issues identified.

"We moved all of our customers to our single billing platform at the end of January and our focus on resolving any outstanding billing issues continues. We remain committed to providing great value and service to our 4.2 million phone and broadband customers."

Ofcom launched an investigation into TalkTalk in July which led to it giving the company a deadline of December 2 to remedy the breach in regulations and pay refunds to customers.

It ordered TalkTalk to provide refunds to all consumers who were billed for cancelled services since January 1 2010, cancel debt collection action and take steps to repair the credit ratings of affected customers.

Because TalkTalk had taken significant steps to fix the problem within the deadline, Ofcom said it could not fine the company for the original offences.

But it can take additional action against TalkTalk, including a possible fine, if it finds evidence of a further breach of the rules.

TalkTalk lost 25,000 subscribers in the final three months of 2010 after disruption caused by switching customers from Tiscali UK.