Depending on when the original credit card payment transaction was processed, you can void the payment or process a credit card refund for the customer.
Void the credit card payment
Simply void the payment if the refund occurs on the same business day as the original transaction (3 pm PT is the settlement cut off time and anything after that is then considered next business day).
To do this: Go to the payment then select More > Void.
Process a credit card refund
Create a refund receipt if the transaction occurs on the next business day after the original transaction was completed.
To do this:
- Select the Plus icon (+) icon at the top, then Refund Receipt.
- Select the customer you want to refund.
- In the table, enter information about the original sale.
- Enter the amount you want to refund.
- From the Payment method drop-down, choose the credit card used for the original payment.
- Select Save and close.
- (Optional) In the Credit Card Transaction Status window, select Print then Close.
Other credit card refund tasks
Reverse a payment
You should not delete a credit card transaction that has already been processed through your merchant account. To reverse a processed amount, select payment has been processed, then Void Payment (or Void Refund, as appropriate). If it has already settled, the only way to reverse the amount is to create an offsetting refund receipt (if this is a payment), or an offsetting sales receipt (if this is a refund).
Create a journal entry
There may be instances after correctly completing the refund, where you find there is no balance in Accounts Receivable (AR) for this customer; or in a special situation where the customer opts to use one credit card for a down payment or the entire purchase is paid by Sales Receipt and then requests to use a different credit card or another form of payment for the down payment or purchase at a later date. In this case, you need to issue a refund receipt and create a journal entry. The refund receipt will place the funds back to the customer’s card. The journal entry places a balance back to AR to account for the refunded down payment.
- Select the Plus icon (+) icon at the top, then Journal Entry.
- On the first line, select Account Receivable then enter the amount refunded in the Debits column and the customers name in the Name column.
- On the second line, select the Income amount used for the item on the Refund Receipt then enter the transaction amount in the Credit column.
- Select Save.
Make sure to document the journal entry by referring to the credit card refund. This Journal Entry is required because the Refund Receipt enters a Credit Memo when the Refund is processed.
Note: ACH refunds are not allowed. The client must refund the customer with a cash or check if the original payment is ACH.