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Refund a Payment

Updated this week

Refund a Payment

Refunds can be issued in-app to clients who have made a payment. This guide will show you how to issue a refund for a credit card payment and an ACH bank payment in Canopy. This guide primarily focuses on direct refunds within Canopy. For alternative scenarios, such as managing credits or refunds processed outside Canopy, refer to the 'Additional Refund Scenarios' section.

Please Note:

  • You can choose between a full or partial refund, with payments returned to the original payment method.

  • There will be a processing fee of $0.20.

  • ACH payments can take up to 7 days to complete. Once the payment is fully processed, you can issue a refund.

  • Adyen does not support payment cancellations. You'll need to wait until the payment is fully processed before issuing a refund.

  • Refund actions automatically remove the credit from invoices and mark them as unpaid, reverting them to their original amounts if applicable.

1. Click the Billing tab on the Navigation bar.

2. Click the Payments tab from the menu.

Alternatively, you can navigate to the client's Billing tab in the client record and select Payments.

3. Click the payment number you would like to refund to open the payment receipt

4. Click Refund Payment

The Refund Payment window will open.

Canopy Tip: If payment sync is enabled for QBO, you'll need to log in and manually record the payment.

5. Select Full Refund or Partial Refund.

If Partial Refund is selected, add the partial refund amount in the text box.

If needed, make a note. This will appear within the transaction history on the payment receipt.

6. Click Process refund.

7. The Refund Submitted window will appear

Options available are the following:

  • Done

  • Download (download the Payment Receipt)

  • Print (print the Payment Receipt)

Refunds can be found in either of these sections:

  • Global Refund Tab

  • Client Level under "Refunds"

Additional Refund Scenarios

Handling Credits After Refunds Processed Outside Canopy

If a client has been refunded outside of Canopy but a credit balance remains in the system, follow these steps to zero the balance without deletion:

  1. Create and Apply a Credit:

    • Create a credit in the account where the deposit was originally recorded.

    • Apply this credit to the relevant invoice to reflect the refund and maintain accurate records.

    • This method ensures the return of the balance to the client while preserving the system credit. Alternatively, you can refund the payment, which automatically deletes the credit. A new payment can then be added and applied to the relevant account to ensure billing accuracy.


Removing a Partially Used Credit and Issuing Refunds

To remove a partially used credit and issue a refund, complete the following steps:

  1. Delete the Credit:

    • Navigate to Billing > Credits dashboard in Canopy.

    • Select the checkbox next to the credit to be removed.

    • Click the trash icon to delete the credit.

  2. Process the Refund:

    • Go to Billing > Payments.

    • Locate the payment number associated with the refund.

    • Click Refund Payment and select Partial Refund.

    • Enter the amount and click Process Refund. Note: Deleting a credit impacts invoice balances, potentially reverting invoices to their original amounts. Refund actions automatically remove the credit from invoices and mark them as unpaid.


Reflecting Refunds Without Using Credits

If a refund is processed outside of Canopy and you do not wish to use credits, you can:

  1. Create a Billing Credit:

    • This method aligns the refund with Canopy’s records by applying the credit to the appropriate invoice.

  2. Manually Adjust the Invoice:

    • Edit the invoice to reflect the reduced balance or mark it as fully paid if the refund covers the complete invoice amount. This keeps your financial records accurate.


Applying Credit Balances Across Years

Canopy supports applying credit balances from previous accounting years to current or future invoices. For example:

  • If a credit balance results from a 2023 prepayment, it can be applied towards 2024 charges or any other future invoices.

  • Simply use the credit as payment when creating or modifying invoices. This flexibility helps maintain smooth accounting and prevents unallocated credits in the system.

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