The results, which also incorporate Bradford & Bingley, show NRAM has now paid back a total of £3.1bn since it was separated from Northern Rock plc.
B&B repaid £150m to the government in 2011.
UKAR paid a further £688m to the government in the form of interest, fees and corporation tax, resulting in overall payments of £2.8bn for the year, up from £1.6bn in 2010.
The firm’s underlying profit before tax more than doubled, from £444.1m in 2010 to £1.08bn in 2011.
It says the 145% increase in profit is down to an improved arrears performance, which resulted in lower loan impairment charges.
Mortgage accounts three months or more in arrears reduced by 14% to 33,216, down from 38,515 in 2010.
The total amount of arrears owed by customers has reduced from £273.6m at the end of 2010 to £233.9m at 31 December 2011.
However, the number of repossessed properties increased from 2,607 in 2010 to 2,705 at the end of 2011, a rise of 3.8%.
Underlying costs reduced by 21%, from £277.5m in 2010 to £220.6m in 2011.
Richard Banks, chief executive of UKAR, says: “We continue to make good progress against our objectives and made further significant repayments of the government loans.
“This improving performance is against a backdrop of challenging economic conditions and increasing hardship for some customers. Arrears and possessions are falling at B&B and we have stabilised the position with NRAM where arrears are now reducing due to our proactive approach.”