At times, it may be necessary to return payments that have been made by a client. This could be due to various reasons, such as a canceled order or a billing error. In such cases, it is important to know the proper steps to take to ensure a smooth and efficient return process.

When returning a payment, two options are available: a reversal or a refund. It is important to understand the difference between these two options so that you can choose the appropriate one for your situation.

A reversal will update the Amount Paid and Amount Due amount on the sale/s. This means that the total amount paid, and the amount still owed on the sale will be adjusted accordingly.

A refund, on the other hand, will not affect the Amount Paid on the sale. This means that the total amount paid will remain the same, but the amount still owed may be adjusted.

Let's look at an example better to understand the difference between a reversal and a refund:

#1 - in case of a Reversal of $20:

In this case, the total amount paid has been reduced by $20, and the amount still owed has increased by $20.

#2 - in case of a Refund of $20:

In this case, the total amount paid remains the same, but the amount still owed may be adjusted depending on the amount of the refund.

Reversals are used when a client has paid using one payment method but then decides to use a different payment method. This can also be used when a client has overpaid but does not want to leave the overpayment as a credit.

For example, let's say a client initially paid for a service using their credit card, but then decides to use their CareCredit account instead. In this case, a reversal would be used to cancel the credit card payment and process the payment through CareCredit.

Another scenario where a reversal would be used is when a client has overpaid for a service. Instead of leaving the overpayment as a credit, the client can request a reversal to have the excess amount refunded to them.

Refunds, on the other hand, are used when you have overcharged a client for a service or when the client disputes the charges.

For instance, if a client notices that they were charged twice for the same service, they can request a refund for the extra charge. Similarly, if a client disputes a charge on their credit card statement, a refund can be issued to resolve the issue.

To issue a refund or reversal for a payment, you can do so from the Payment area in Billing or directly from the Payment report by using the Reversal/Refund icon.

If you complete the refund or reversal from the Payment area, the amount allocated to the sale will be used. However, the entire payment amount will be returned if you complete the transaction using the Payment report.

When completing the process, you must first select the appropriate type (reversal/refund) and then fill in the following fields:

Once the refund or reversal is completed, it will appear on the payment report on the transaction date. It will also be visible on the Sales report when the sale detail is expanded.

📌 The initial payment method will be automatically selected for refunds (so if you charged via card, the refund will automatically be marked as 'card').

📌 If the initial payment was made at the terminal after you issued the refund in Digitail, the client needs to tap the card on the terminal, and the money will be refunded automatically.

📌 The refunds issued on online payments via Vetpay will happen automatically.

📌 For all the other payment types, you still need to transfer/refund the money to the client manually.