Record a refund to a customer

If your customer returned faulty goods after they paid for them or you sent them a refund for a credit note, you can record the customer's refund in Accounting Start.

You can post a refund against a stand-alone credit note from the Banking page or from within the credit note. If you want to refund a payment on account, you must do this through Banking. When you record the refund through Banking, you can also produce a remittance advice, which you can then send to your customer to let them know which transactions you're refunding.

If you need to refund a credit note or a customer receipt that has been allocated to an invoice, you have two options:

• Create a stand-alone credit note, and then refund it. The credit note reverses the sale recorded by the original invoice, and the refund reverses the receipt.
• Unallocate the original invoice and customer receipt or credit note so that the invoice is outstanding and the receipt becomes a payment on account, or the credit note becomes a stand-alone credit note. You can then record a refund against the credit note or payment on account. You should choose this option only if your customer intends to make a payment for the same invoice at a later date.

If you have set up cheque printing, you can print cheques from the Cheque Register. For more information about printing cheques, see the following topics:

• Set up cheque printing
• Print and manage cheques

To post a customer refund from Banking

1. Go to Banking, and click the applicable bank account.
2. On the New Entry menu, click Expense/Payment to open the Payment (Outgoing money) page.
   Note:

   You can also create a refund by going to Banking and clicking Expense/Payment on the New Entry menu. In this case, you must select the correct bank account when entering the payment details.

3. Click the Customer Refund tab and then enter the following information. Fields with an asterisk (*) are required.

   Customer *	Enter either the company name or reference. As you start to type, the list of customers appears.
   Paid from Bank Account	Verify that the correct bank account appears. If not, select the correct account from the list.
   Method *	Specify the payment method. Note: If you select cheque, you must also select a vendor for the transaction in order for it to appear in the Cheque Register. You can print the cheque from the Cheque Register.
   Date Refunded *	Enter the date of the refund.
   Amount Refunded *	Enter the total amount of the refund.
   Your reference (optional)	Enter a reference for this refund.

   * Indicates a required field.

   Note:

   By default, the outstanding credit notes and payments on account appear. To view all credit notes and payments on account, on the Display menu, click All.

4. Select the check box for the credit note or payment on account that you're refunding.

   You can't refund part of a payment on account or credit note. If you need to refund part of a transaction, you must first allocate the necessary amount of the payment on account or credit note to the relevant invoice, and then refund the remaining outstanding value.

5. Do one of the following:
   • To produce a remittance advice, on the Save menu, click Print Remittance. The remittance advice opens in a new window, and you can print or save it from your browser menu.
   • To add another refund without creating a remittance advice, on the Save menu, click Expense/Payment, and repeat these steps beginning with step 3.
   • To save the refund without creating a remittance advice or adding another refund, click Save.

You've recorded the refund, and the bank and customer account balances are adjusted accordingly.

To post a customer refund from within a credit note

If you're refunding part of the credit note, for example because you've used part of it to pay an invoice, if you haven't already done so, you must allocate the relevant amount of the credit against the invoice before you record the refund for the outstanding balance.

1. Go to Sales, and then Sales Credit Notes.
2. Click the applicable credit note.
3. Click Process Refund and enter the following information. Fields with an asterisk (*) are required.

   Amount Refunded *	This is the total value of the credit note. This amount cannot be changed.
   Paid from Bank Account *	Select the bank account used for the refund.
   Method *	Specify the payment method. Note: If you select cheque, you must also select a vendor for the transaction in order for it to appear in the Cheque Register. You can print the cheque from the Cheque Register.
   Date Refunded *	Enter the date of the refund.
   Your Reference (optional)	Enter a reference.

* Indicates a required field.

4. Click (Optional) .

You've refunded the credit note, which now shows as paid.

Occasionally, you may need to refund a receipt (or payment) that you entered on a sales invoice (for example, if your customer returned damaged product). Follow the steps below to create a refund.

1. Go to Sales.
2. Click the sales invoice.
3. On the right, click the <n> payment link (above the Record Payment button) to open the Payments and Allocations window.
4. Click Edit (the pencil icon) in the Refund column for the payment to open the Amend Customer Receipt window.
5. Enter the refund date, and the bank account from which you want to issue the refund and enter a reference if needed.
6. Click Save. If there was only one payment, the invoice is set to Outstanding. If there was more than one payment, the invoice is set to Part Paid.

If needed, you can now cancel the invoice (or part of it) by creating a sales credit note.