The authority is to leave its planned 15-year partnership with BT, called Transform Sandwell, nine years early after bosses said they were unhappy with the service.
Today the Express & Star can reveal that the council has not paid BT since before it began dispute proceedings with the telecommunications giant last September and the sum is in the region of £8m.
It is understood the council claimed it had overpaid BT previously because it was doing less work than was agreed when the two parties signed their contract in 2007.
The authority stopped paying the firm any new fees and it is understood BT will not pursue the outstanding amount, now an end date has been agreed for the partnership.
BT would not be drawn to discuss the dispute between the two parties further but did confirm that a date had been agreed for the contract to end.
Emma Tennant, spokeswoman for the firm, said: "BT and Sandwell Council have now formally confirmed the Transform Sandwell partnership will run until March 31, 2014. They will continue working together towards a smooth transition of staff and services."
Around 300 employees are due to return to work for the council but council leader Darren Cooper has previously said it was 'inevitable' some posts would be shed in the move.
The deal was signed in 2007, and saw the council pay a fixed £15m a year to BT for the management of services, including finance, customer contact and communication, and there was another element of variable charges for work done for third parties such as schools. But last July the authority told the firm it wanted to bring its contract to an end, unless BT addressed issues raised by the council within 30 days.
The disagreement could not be resolved and both parties began to draw up an exit plan.