If you need to return your customer's money, don't worry. Here's how to record a refund based on various scenarios. This ensures your books are up-to-date.
In the Customer field, select the appropriate customer.
Enter the Credit Memo Date, Amount, Tax, and Product/Service (This is the category, product, or service you’re getting a credit for).
Select Saveand close.
Note: If the customer has overpaid – you do not need the credit memo as you will already have an unapplied credit that acts as your credit memo.
Select + New and select Expense.
In the Payee field, select or enter the desired customer.
In the Payment account field, select the bank the money is being refunded from.
In the Category field, select the Debtors account (Accounts receivable).
In the Amount field, enter the amount of the refund.
In the Tax field, select the appropriate Tax (not inclusive/exclusive of tax).
Select Save.
Next, go to + New and select Receive payment.
Add the Customer and choose the Payment method and Deposit to.
Balance should be 0 as they will cancel each other out.
Select Save and close.
If you have Online Banking, go to Bookkeeping then Transactions then select Banktransactions (Take me there), or go to Banking (Take me there). Then match the record you found.
In the Vendor field, select the appropriate vendor.
Enter the Payment date, Amount, Tax, and Category (This is the category, product, or service you’re getting a credit for).
Select Saveand close.
Note: If the vendor has been overpaid – you do not need the vendor credit as you will already have an unapplied credit that acts as your vendor credit.
Select + New and select Bank deposit.
In the Add funds to this deposit section, enter the following information:
In the Received From field, select or enter the desired vendor.
In the Account field, select the Creditors account (Accounts payable).
In the Amount field, enter the amount of the refund.
In the Tax field, select the appropriate Tax (not inclusive/exclusive of tax).
Select Save and close.
Next, go to + New and select Check.
Add the payee and choose the Vendor Credit and the deposit (from the drawer that appears on the right-hand side) and add them both.
Balance should be 0 as they will cancel each other out.
Select Save and close.
If you have Online Banking, go to Bookkeeping then Transactions then select Banktransactions (Take me there), or go to Banking (Take me there). Then match the record you found.
You can use refund receipts if a customer asks for a refund for an item or service. If they used a credit card, learn how to refund a credit card payment.
Note: To avoid a double refund, make sure you didn't enter a credit memo yet.
To watch more how-to videos, visit our video section.
Select + New.
Select Refund receipt or Give refund.
Select the Customer ▼ dropdown, then select the customer you want to refund.
Select the Refund From ▼ dropdown, then select the bank you deposited the payment for the invoice to.
Add all products or services the customer returned in the Product/Service column.
Make sure to fill the date, quantity, rate, amount, tax, and other fields accordingly, then select Save and close. Note: If you want to give a partial refund, only add the items or amount you want to refund.