Refunding a Deposit

There may be times when you need to refund a deposit to a client, whether they canceled within your facility's cancellation policy timeframe or you are issuing the refund as a goodwill gesture. To properly refund a credit card deposit, the deposit must first be applied to an invoice before the refund can be processed. Following the correct process ensures the deposit is removed from the client's account and the refund is returned to the original payment method.

⚠️ Important: Deposits, credits, and prepayments are not attached to specific appointments in Kennel Connection. If a deposit needs to be removed from a client's account, it must be applied to an invoice first.

If a client cancels, no-shows, or otherwise forfeits their deposit according to your facility's policies, the deposit must still be applied to an invoice in order to remove it from the account. If this step is not performed, the deposit will remain available and can be applied to future invoices.

A common practice is to create an invoice using a line item such as Forfeiting Deposit and pay that invoice using the deposit balance. This removes the deposit from the client's account without issuing a refund.

Create the Deposit Invoice

The first step is to create an invoice that will be paid using the deposit currently on the client's account. In our example, we are refunding a $1 deposit.

1. Navigate to Financial > Create Invoice.
2. Select the client.
3. Click Proceed.
   
   
4. Add an inventory item such as:
   • Refunding Deposit
   • Zeroing Out Credit
   • Forfeiting Deposit
     
5. Enter the deposit amount in the Each column.
6. Click Edit Item.
   
7. Click the green Pay button.
   

You will now be taken to the receipt screen.

The invoice will appear highlighted in green and the client's available deposit will be displayed.

8. Click Apply next to the deposit.
9. Verify the deposit covers the invoice balance.
10. Click the green Pay $0.00 button.
    
11. Payment method will display as Credit at $0.00>Click Process.
    

Once paid, the deposit balance will be removed from the client's account and can no longer be applied to future invoices.

💡 Quick Tip: You can add a description to the invoice line item indicating why the deposit is being refunded and the date the refund was approved. This can be helpful for future reference and auditing purposes.

⚠️ Recommended Best Practice: Create a dedicated inventory item specifically for deposit adjustments, such as "Refunding Deposit" or "Forfeiting Deposit." This makes it much easier to understand the purpose of the transaction when reviewing invoices later. Otherwise, it may appear as though, grooming, or another service was refunded when that was not actually the case.

Process the Refund

After the deposit has been applied to the invoice:

1. Navigate to Financial > View Invoices.
2. Locate the invoice you just created.
3. Click the gray dropdown arrow.
4. Select Refund/Return.
   

The invoice will reopen in refund mode.

5. Locate the inventory item on the invoice.
6. Change the Qty from 0 to 1.

The system will automatically convert the quantity to -1, indicating the item is being refunded.

7. Click Issue Refund then Submit.
   

⚠️ Important: Refunds can only be returned to the original payment method used for the transaction. Funds cannot be redirected to a different credit card, bank account, or client account.

Refunds vs. Voids

Refunds and voids are not the same thing.

Voids

A void can only be performed on the same day the original transaction was processed and before the payment batch has settled.

Voiding stops the transaction from completing and prevents the funds from being transferred.

If you try to refund a transaction the same day, it ill give you this pop up:

Refunds

A refund can only be processed after the payment has settled and the business has received the funds.

If the payment has already batched and settled, it can no longer be voided and must be refunded instead.

Common Uses

• Refunding deposits when a client cancels within your facility's cancellation policy.
• Issuing goodwill refunds for customer service purposes.
• Removing forfeited deposits from a client's account after a cancellation or no-show.
• Correcting deposits that were collected but should no longer remain on the client's account.
• Maintaining accurate client balances and deposit records.