Refund Payments for Individual Transactions

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Overview

You can refund the entire amount of a transaction or portions of it. When you issue a refund, the gross amount equals the net amount of the original transaction plus the refunded fee from PayPal.

Gross Amount = Net Amount + Refund Fee

The default refund period is 180 days from the transaction date. If you issue a refund within 180 days, PayPal credits the original transaction fee for receiving the payment to your account. For partial refunds, PayPal credits a percentage of the original transaction fee based on the refunded amount. When you issue a refund after 180 days, your original transaction fee for receiving the payment is not credited to your account.

Issuing refunds using the API

You can use the RefundTransaction API operation (NVP, SOAP) to make a full or partial refund to a customer. The RefundTransaction API operation issues a refund to the PayPal account holder associated with a transaction. This API operation can be used to issue a full or partial refund for any transaction within a default period of 180 days from when the payment is received. For integration information, see How to Make a Basic Refund.

After the refund period has passed, merchants can no longer use the RefundTransaction API operation to issue refunds. Instead, merchants can manually issue a credit to the buyer by logging into their PayPal account; for PayPal payments, a credit can be issued by clicking Send Money. Alternatively, merchants can use the MassPay API (NVP, SOAP) to credit PayPal accounts or utilize the DoNonReferencedCredit API operation (NVP, SOAP) to issue a credit to a card without referencing the original transaction.

Issuing refunds from paypal.com

Merchants can manually issue a credit to the buyer by logging into their PayPal account. The refund process is different if 180 days have passed from when the payment was made.

Refunding Within 180 Days of Payment

To issue a refund within 180 days:

  1. Log into your PayPal business account.

  2. Click the Payments received link in the Transactions panel of the Summary page.

    Note: If you do not see a Summary link at the top of the page, click Overview, which appears in the top menu when the My Account tab is selected, and then click the Payments received link.

  3. Click the payment you want to refund. The Transaction Details page opens.

  4. Click the Issue a refund link.

    Note: If you do not see an Issue a refund link, the payment may not be refundable through paypal.com because 180 days have passed since the payment was made. For alternative refund methods, see refunding after 180 days or issuing refunds using the API.

    This image shows the Issue Refund page:

  5. Enter the refund amount. You can also enter information in the Message to buyer text box to let the buyer know why you are sending the refund. This message has a limit of 255 characters.

  6. Click the Continue button. The Review and process refund page displays.

  7. Verify that the refund amount is correct and click the Issue Refund button.

Note: If you refund a pending eCheck payment, no fees are charged because the pending payment is effectively canceled.

Refunding After 180 Days

To issue a refund after 180 days:

  1. Log into your PayPal business account.

  2. Click the Money link at the top of the page, and then click Send Money.

    Note: If you do not see a Money link at the top of the page, click the Send Money tab.

  3. Click Send money to friends and family.

  4. Enter the required information, then click Next.

  5. Review the information, then click Send to complete the refund.