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How to void a credit card payment or process a credit card refund

Depending on when the original credit card payment transaction was processed, you can void the payment, process a credit card refund for the customer, reverse a payment or create a journal entry.

Void the credit card payment

Simply void the payment if the refund occurs on the same business day as the original transaction (3 pm PST is the settlement cut off time and anything after that is then considered next business day).

  1. From the left menu, select Sales, then choose All Sales.

  2. Find and select the payment transaction you need to void.
  3. Select  More and then select 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.

  1. Select the Plus icon (+) on the Toolbar.

  2. Under Customers, select Refund Receipt.

  3. Select the customer you want to refund.
  4. From the Payment method drop-down, select the credit card used for the original payment.
  5. In Refund From, enter the account where refund is from.
  6. In the table, enter information about the original sale.
  7. Select Save and 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 that 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 the customer 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 and the journal entry places a balance back to AR to account for the refunded down payment:

  1. Select the Plus icon (+) on the Toolbar.

  2. Under Other, select Journal Entry.

  3. On the first line, select Accounts Receivable (A/R).
  4. Enter the amount refunded in the Debits column and the customers name in the Name column.
  5. On the second line, select the Income amount used for the item on the Refund Receipt, then enter the transaction amount in the Credits column.
  6. 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.
  • When you process a refund, it can take a few days to show up in your merchant account. Transactions under $500.00 will post within 2 to 3 business days and transactions that are $500.00 or more will take 7 to 10 business days to post.You can also view your transactions online through the Merchant Service Center .
  • If you are refunding a card because the same payment was processed twice by mistake, there may be additional steps required. Follow the steps in correcting a customer's credit card that was processed twice by mistake.
  • ACH refunds are not allowed. The client must refund the customer with a cash or check if the original payment is ACH.

Now you’re able to void the payment, process a credit card refund for the customer, reverse a payment or create a journal entry.