What Square Charges When You Refund a Sale
A refund sends the customer's money back. What happens to your processing fee depends on the plan you picked and how the card was charged.
A customer brings back a $60 jacket. You tap refund, the money goes back to her card, and she leaves happy. Then you look at your deposit and wonder where part of your fee went. Square refund fees confuse many shop owners, so here is what Square's own pricing page says about them.
What a refund actually does to a processed payment
When you refund a sale, the customer gets the full amount back. The question is what happens to the fee you paid when the card was first charged. Square's pricing page does not list a separate fee just for issuing a refund. The fee you already paid is the one in play.
Square's pricing page does not spell out which part of the fee returns on a refund. Check your own account's fee details before counting on any of it back.
Which Square fees are returned on a refund, per Square's pricing page
Square's pricing page says you only pay processing fees when you take a payment. It also says its plans start at no cost and have no hidden fees or locked-in contracts. Neither line promises that a refund returns your fee.
The page does mention gift cards. It says there are no additional fees when a gift card is redeemed. The page does not promise fee returns on refunds. Treat the fee as spent until Square's own documentation for your account says otherwise.
How your Square plan changes the picture
Square's pricing page says processing fees vary based on the Square plan you choose. With Square Free there are no monthly subscription costs, and you only pay processing fees when you take a payment. The monthly fee per location is $0, $49 or $149, and Square Plus and Square Premium charge it per location.
The plan shapes your rate, and your rate shapes the size of the fee you might lose on a refund. Square's pricing page says in-person card payments run from 2.6% + 15¢ to 2.4% + 15¢, depending on the plan. A sale on the lower rate carries a smaller fee than the same sale on the higher one.
The monthly fee itself does not come back on a refund. Square's page charges it per location, not per sale.
Refunds across different payment types
The way a card was charged sets the fee, and that fee is what a refund puts in question. Square's pricing page says:
- In-person card payments run from 2.6% + 15¢ to 2.4% + 15¢, depending on the plan.
- Online and invoice card payments run from 3.3% + 30¢ to 2.9% + 30¢, depending on the plan.
- Manual entry or card on file payments cost 3.5% + 15¢.
- Card payments through its payments APIs cost 2.9% + 30¢.
- Afterpay payments cost 6% + 30¢.
- EBT card payments for SNAP-eligible items cost 1.8% + 5¢.
A refund of an Afterpay sale involves the largest fee on that list. A refund of a cash sale involves none, because Square's pricing page says cash or check payments are free. An additional fee applies to cards issued outside of the United States. That fee faces the same open question as the rest.
Square's pricing page says you can accept every major card, Visa, Mastercard, American Express, and Discover, all for the same processing fees. So the card brand does not change the processing fee.
Where to see refunds and fees in your Square reports
Square's page says the reconciliation report breaks down sales, refunds, fees, and deposits so you know where your money's going. That is the first place to look after a busy return day.
The sales insights feature lets you select a date range to track a sales summary, including payments and fees. Team sales and activity reporting tracks who issued refunds and when employees clocked in, which helps if a refund went out by mistake.
Pull the reconciliation report at the end of any month with several refunds. Compare the refund total against the fee total and you will see what a return actually cost you.
Before you sign up: confirm current pricing on Square's page
Published prices change. The rates and plan fees above come from Square's pricing page as written there, and Square can update them any day. Read the page yourself before you sign up, and ask Square directly how refunds treat fees on the plan you want. Businesses that process over $250,000 per year can talk to its team about custom pricing and processing fees. That talk is a good place to get the refund answer in writing.
If you want to see how a single sale gets its fee taken in the first place, read how a $40 counter sale is priced. If speed matters more than refunds, see what instant payouts cost.