Refund an order

Issuing refunds

If for any reason you need to return a customer's money for an order, you can do that through your PayPal or Stripe account (depending on which method the customer used to pay). You can also issue full or partial refunds, and even add a private note to the order so you have a record of it.

And if you've got stipulations regarding refunds (maybe you want to limit refunds to 45 days from the purchase date), then you can add those details to a policies page in your shop.

Sales tax refunds

We'll handle the tax portion of the refund on any U.S. orders where we collected and remitted sales tax. How those refunds are issued will depend on whether the order was processed via PayPal or Stripe.

Keep in mind that there's not a way to issue sales tax-only refunds irrelevant of which checkout the customer used to complete their order.

Whether you are using Stripe and/or PayPal, we are notified of the refunded tax and adjust our remittance to the state.

Refunds in PayPal

If you issue a full refund on an order that went through PayPal, and we remitted sales tax on the order, then we'll automatically send the sales tax portion of the order back to your PayPal balance since you'll cover it on the initial refund.

If you're issuing a partial refund, you'll need to include the sales tax in that refund as well. Be sure to calculate the sales tax portion using the buyer's sales tax rate when calculating how much to refund. Then we'll refund that partial tax back to your PayPal balance.

Refunds in Stripe

If you're issuing a full refund, and the order went through Stripe, then we'll refund the sales tax collected on the order directly back to the customer.

If you’re issuing a partial refund, the amount of tax we refund will be calculated based on how much you refund the customer.

If you use inventory tracking in your shop, keep in mind that refunding an order doesn't modify the quantity in stock or return inventory to products that were purchased. So if you're not sending out items to a customer after a refund, make sure to manually adjust any inventory as needed in your product listings so your quantities are accurate.