Returns and refunds

Refunding a sale erases nothing: what you collected stays on record as a historical fact, and the document moves to Refunded or Partially refunded, with its own refund record attached. This guide covers the full flow, the three refund methods and what happens to the customer's balance.

Reading time: ~7 min

When to use this

• The customer brings goods back and you have to return their money.
• You overcharged and want to correct it without voiding the whole sale.
• You cancelled a counter sale and need the accounting trail to be right.
• You want to understand why a refunded sale no longer shows up in accounts receivable.

If what you need is to collect (record a payment, split it across methods, or void a payment recorded by mistake), go to Payments and payment methods.

Before you start

• The order must be billed: you do not refund a draft, you cancel it.
• Permissions, depending on where you refund from:
  • invoices:refund to issue the refund from the order, in the back office.
  • pos:orders.refund to process a counter return from the point of sale.
• To refund in cash you need an open cash shift: the money leaves that register and shows up in its reconciliation.
• To refund with a credit note, that option always appears in the dialog, but you can only pick it when two conditions hold at once: your business has the electronic invoicing module active, and the invoice you are refunding already has a document accepted by the DGII (conditionally accepted counts as accepted). If either is missing, the option shows disabled with the reason written underneath - it never disappears without an explanation. See Why can't I pick a credit note when refunding? below.
• To leave the money as a customer credit balance, you do not need anything special: it is available whether or not the electronic invoicing module is active. You do need the order to have an identified customer - an anonymous counter sale cannot leave a balance.
• If you have accounting active, the accounting period covering the refund date must be open.
• If the invoice carries a tax document, the ITBIS refund follows the 30-day window from the invoice date by default. To invert that default (return the ITBIS past 30 days, or withhold it within them) you need the invoices:withhold-tax-override permission. See ITBIS on the refund below.

What happens to the document when you refund

A refund does not change what you already collected. The order's paid total stays as it is, because it is something that happened. What changes is the document status, plus a refund record of its own.

Both statuses have their own tab in the order and invoice lists, so you can filter them just like Paid or Unpaid.

A refunded sale stops counting as customer debt. Previously, refunding an already-paid sale made the system show that amount as outstanding, and the customer appeared to owe money that had in fact been handed back. That no longer happens: the document moves to Refunded, the balance drops to zero and it disappears from accounts receivable and from the customer statement.

Step by step

1. Open the order and click Refund

Go to Operations → Orders, open the billed order and click Refund. From the point of sale, a counter return is done on the sale you just collected, within the shift.

2. Choose what to return

The dialog lists the order lines with the quantity still left to refund on each one, not the original quantity. If you already returned 2 out of 5 units, next time the dialog offers you 3 at most. That way you cannot refund the same thing twice by accident.

Tick the lines and adjust the quantities. For a full refund, tick everything.

3. State the reason

The reason is mandatory and is stored with the refund. Write something that will still make sense in six months: "faulty goods", "customer changed their mind", "wrong amount charged at the counter".

4. Pick the refund method

• Cash. The money physically leaves the register. It requires an open shift and shows up as an outflow in that shift's reconciliation, so the closing count matches the drawer.
• Credit note. A credit note is issued in the customer's name, carrying a balance they can spend on another purchase. It always appears in the list, but you can only pick it when your business has electronic invoicing active and the original invoice's document was already accepted by the DGII; in any other case it shows disabled with the reason underneath, because a credit note is an electronic tax document filed with the DGII, not an internal note.
• Customer credit balance. The money does not leave the business: it is recorded in the customer's name and they can use it to pay for a future purchase. It is available whether or not electronic invoicing is active. If the order has no identified customer, this option shows disabled with the reason visible - a balance has to belong to somebody.

With no credit note available - for either reason - you always still have cash or a credit balance. Blocking the credit note never leaves a refund with no way out. And it is worth being precise about what that means: a cash refund recorded in Mosce ERP is an operational record of yours, it does not replace a credit note before the DGII. If your business issues electronic tax documents and needs to support the refund before the DGII, the way to do it is the credit note. See the official DGII e-CF documentation or ask your tax advisor.

Only money that was actually collected can become a balance. If the sale was never collected, the refund still happens the same way - the goods come back and stop being owed - but no balance is left, because there is no money to leave. If part of it was collected, the balance is that part. The screen warns you of this before you confirm.

The customer credit balance is not a credit note. They are different things, with different accounting treatment and different fiscal meaning. If the invoice's document was already accepted by the DGII, the refund also issues its electronic credit note (E34) no matter which method you pick: withdrawing value from an accepted document is mandatory before the DGII, and that is independent of where the money ends up. See Does a refund always issue a credit note? below.

5. Confirm

On confirmation, Mosce ERP:

• Records the refund with its reason, its method and who did it.
• Moves the document to Refunded or Partially refunded.
• Drops the balance to zero on a full refund and takes it out of accounts receivable.
• Puts the returned goods back into the warehouse.
• Issues the credit note, if that is the method you chose.
• Leaves the corresponding amount as a customer credit balance, if that is the method you chose.
• Records the cash outflow in the cash shift, if you chose cash.

If something fails at that moment (the shift was closed, the connection dropped), the dialog stays open with your data in it. You fix what needs fixing and confirm again, without redoing the whole path from the order.

ITBIS on the refund: the 30-day window

When the invoice carries a tax document, the refund box tells you which window it falls in and how many days have passed, and breaks the amount down into Taxable base, ITBIS, ITBIS withheld by the business (only when it is withheld) and Total to refund:

• Within 30 days: "The invoice was issued N days ago, within the 30 days the DGII allows for returning the ITBIS. By default, the ITBIS is returned to the customer."
• Past 30 days: "The invoice was issued N days ago, more than the 30 days the DGII allows for returning the ITBIS. By default, the ITBIS is withheld."

The boundary is inclusive (day 30 still returns it, day 31 already withholds it) and the count starts from the invoice date.

If you hold the invoices:withhold-tax-override permission, the dialog shows a "Withhold the ITBIS on this refund" toggle that inverts the default in either direction. Without that permission, the toggle does not appear and the refund follows the invoice's default.

Inverting the default does not carry the same weight in both directions:

• Withholding within 30 days is harmless: you are only giving up a refund the customer was entitled to.
• Returning past 30 days does have consequences: the document declares to the DGII that this note does not carry the right to rebate ITBIS, while your books rebate it anyway. That is why, before you confirm, the dialog warns you: "You are about to return the ITBIS even though more than 30 days have passed since the invoice: the document will declare to the DGII that this note does not carry the right to rebate ITBIS, but the books will rebate it anyway. It will be recorded that you authorized this exception." Who authorized it is recorded.

What the toggle does not change. The code the credit note carries before the DGII, stating whether or not it carries the right to rebate ITBIS, is calculated solely from the invoice's and the note's dates; neither the permission, nor the toggle, nor any administrator changes it. What the toggle moves is the money: who ends up with the ITBIS. For the full rule, see ITBIS on returns in Void and modify e-CFs.

Example: an invoice for RD$1,146.00 (base RD$1,020.00 + ITBIS RD$126.00) is refunded 35 days later. The customer receives RD$1,020.00, the business withholds RD$126.00 of ITBIS, and the order ends up fully refunded with a zero balance.

Full refunds and partial refunds

• Full: you return every line and every quantity. The document ends up Refunded with a zero balance.
• Partial: you return part of it. The document ends up Partially refunded and you can return more later, up to whatever the dialog keeps offering you.

A sale can go through several partial refunds until it is exhausted. Once there is nothing left to return, the document moves to Refunded.

A full refund is still full even when it withholds the ITBIS. If you refund every line and every quantity and the ITBIS ends up withheld, the document still moves to Refunded with a zero balance: the withheld ITBIS does not sit half-collected or go back into accounts receivable, because it is money the customer will never see either way. This can feel counterintuitive because the amount you actually hand back is smaller than the invoice total, and yet the refund is complete.

Refunding an invoice with third-party withholding

If the invoice you are refunding carried a third-party withholding - the customer withheld ITBIS and/or ISR when paying you -, the refund reverses that withheld tax credit first. It never treats it as cash that has to be given back: it is tax the customer already filed with the DGII on your behalf, not money that passed through your register or your bank.

Only what actually came in as cash, card, transfer, or cheque - or what was left outstanding - follows the normal refund path described above. The withheld amount is not handed back in cash and is not offered as a credit balance, because it was never money you held in the register. See Chart of accounts for where that credit lives.

Expected result

• The order and its invoice show the new status and appear under their tab in the list.
• The customer no longer shows debt for that sale in their statement.
• If you refunded in cash, the shift reconciliation reflects the outflow and the closing count is correct.
• If you issued a credit note, it stays linked to the original order with a balance available to that same customer. See Payments and payment methods.
• If you left the money as a credit balance, it shows up on the customer's profile and is available to pay for another purchase. See Clients and Payments and payment methods.

Common problems

Frequently asked questions

Does a refund free up my monthly sales limit?

No. The plan limit is consumed when the invoice is issued, and refunding afterwards does not subtract it from the current month. The counter resets on its own on the first day of the following month. See Plan usage limits.

Can a cashier issue refunds?

Yes, within their shift and at the counter: handing money back at the register goes into the shift reconciliation, so it is part of working a till. What the Cashier role does not carry out of the box is refunding from the back office outside the shift, applying a credit note as a payment method, or voiding a payment that is already booked. See Users, roles and permissions.

Is refunding a sale the same as voiding a payment?

No, and it is worth keeping them apart. Refunding is giving money back to the customer for goods or services: it creates a refund record and changes the document status. Voiding a payment is correcting a collection that was recorded wrong (wrong method, wrong amount, duplicate): the payment stops counting, but the document goes back to being outstanding. See Payments and payment methods.

Does a refund always issue a credit note?

If the DGII already accepted that invoice's document, yes, always, whichever method you pick. They are two independent things:

• The method (cash, credit note) only says how the money reaches the customer.
• The electronic credit note is what modifies the document with the DGII. Once the DGII accepts a document, the only way to correct or withdraw it is by issuing a credit note that references it. It is not optional.

That is why a cash refund, or one that leaves a customer credit balance, of an already accepted invoice issues its credit note too: the customer gets their money (or their balance) on one side, and the document is corrected with the DGII on the other. The screen tells you before you confirm.

If the document was not accepted (rejected, pending delivery, or the invoice has no document), there is nothing to modify with the DGII and no credit note is issued.

Why can't I pick a credit note when refunding?

The Credit note option always appears in the dialog, but you can only pick it when two conditions hold at once, and each has its own way out:

• Your business does not have the electronic invoicing module active. There is no way to issue any document yet. The option shows disabled with that reason. Way out: activate and configure the module, or refund in cash or as a credit balance in the meantime.
• The module is active, but the invoice you are refunding has no document accepted by the DGII (it was rejected, is still pending a response, or the invoice never generated a document at all). An electronic credit note has to reference the document it corrects, and the DGII validates that the referenced document has already been filed with it before accepting the reference. A rejected document, or one that was never issued, is not in the DGII's records: there is nothing for the note to point to. Way out: refund in cash or as a credit balance; if the document later gets accepted, the credit note becomes available for that invoice.

If both conditions are missing at once, the reason you see is the electronic-invoicing one, since it is the broader fact: knowing the invoice is not accepted is no use if your business cannot issue documents at all.

Either way you are never left without a way to refund: blocking the credit note never leaves a refund with no way out, since cash and the customer credit balance stay available. See Voiding and modifying e-CFs for the full rule behind referencing a document.

What is the customer credit balance and when should I use it?

It is money the business owes the customer, recorded in their name instead of handed back on the spot. Nothing leaves the register and no credit note is issued through this route - the credit note, if one applies, is issued the same way and separately, depending on whether the document was already accepted. It is worth using when the customer is coming back to buy again: the balance spends itself, from the oldest source to the newest, the next time they pay for something. See Clients for where it shows and how it affects credit, and Payments and payment methods for how it is spent.

Is refunding everything the same as refunding part of it?

Not to the DGII. The credit note carries a code stating what it does to the original document:

• Full refund (every line, full quantities): the credit note voids the document entirely, for its full outstanding amount.
• Partial refund: the credit note corrects the amount of the document, for what was returned. The document stays valid for the rest.

The system picks the right code for you from what you return; you do not have to state it. You can consult the rules on the DGII electronic invoicing portal.

Who decides whether the ITBIS is returned or withheld?

Two different things, and you only get to choose one:

• The code the credit note declares to the DGII on whether it carries the right to rebate ITBIS is calculated on its own, from the invoice's and the note's dates. Nobody changes it: not you, not a permission, not an administrator.
• Who ends up with the ITBIS money is a decision, but only by default based on the date: it is returned to the customer if the invoice is 30 days old or less, withheld if it is older. An administrator holding the invoices:withhold-tax-override permission can invert that default in either direction, for that particular refund.

In other words: the dialog's toggle moves the money, not what the document tells the DGII. See ITBIS on the refund above for the detail and the asymmetry between returning and withholding.

Is refunding the same as cancelling?

No, and you are no longer offered both at once. The difference is whether you collected money on that sale:

• You collected something (all of it or part): the action is Refund, and you choose the method. On an invoiced order holding collected money the Cancel button is no longer shown, because cancelling ended up doing what refunding does, and two buttons for one operation invited mistakes.
• You collected nothing: the action is Cancel, from the order detail. All four cases are explained in Orders.

Can I refund a credit sale the customer never paid?

You do not need to: if no money came in, there is nothing to give back. Close it with Cancel from the order detail.

That does not mean nothing is issued. If the DGII had already accepted that invoice's document, cancelling it issues an electronic credit note that voids it with the DGII, paid or not: it is the only route the rules allow for a document already accepted. The only difference from a refund is that no money goes back here, because none came in, so there is no method to choose. The credit note is issued all the same, and it does not become spendable credit for the customer: it is applied to the very invoice it voids.

Do returned goods go back into inventory?

Yes. Returned goods are added back to the warehouse they left from.

Related

• Payments and payment methods
• Clients - where the credit balance shows and how it affects the customer's credit.
• Orders
• Invoices
• Point of sale (POS)
• Cash register
• Voiding and modifying e-CFs