Handling Refunds and Exchanges with Deposit Fees
When a customer returns a product that had a deposit fee, you'll need to handle the deposit refund as well. Here are the most common approaches:
Option 1: Full Refund via Shopify (Most Common)
Use Shopify's built-in refund process to refund both the product and the fee:
Go to Orders in your Shopify admin
Find the order
Click Refund
Select both the product and the Fee line item
Process the refund
For detailed instructions, see Shopify's refund guide.
Option 2: Exchange Without Re-Charging the Fee
If the customer is exchanging for a similar product with the same deposit fee:
Process the exchange as normal
Don't charge the deposit fee again since the customer already paid it on the original purchase
On POS, you can simply not apply the new fee during the exchange transaction
Option 3: Discount Code for Next Purchase
Some merchants prefer to offer a discount code equal to the deposit amount for the customer's next order, rather than processing a separate refund for the fee.
Partial Refunds
If a customer returns only some items from a multi-item order:
Refund the deposit fee proportionally for the returned items
In Shopify's refund screen, you can adjust the refund amount manually for the Fee line item
POS Returns
For POS returns, follow your normal POS return process. The fee line item will appear in the return just like any other product.
POS Walk-In Bottle Returns (No Receipt)
For stores that accept bottle returns at the counter — even without a receipt or customer account — here is the recommended workflow:
Cash Returns
Create a custom "Bottle Return" product in Shopify with a price of $0
Optionally, create variants for common deposit amounts (e.g. $0.05, $0.10, $0.25)
When a customer brings bottles back, add the Bottle Return product to a new POS cart
Manually set the price to match the total deposit value, or select the correct variant
Process as a cash refund — no customer account or receipt needed
Credit Card Returns
Credit card refunds typically require a linked transaction. If the customer has an account or you can look up their original order, process the refund through Shopify's standard return flow. For walk-ins without a transaction history, cash is usually the simplest option.
Tip: Hide the Bottle Return product from your online store and search so customers can't accidentally purchase it. See How to hide products from your catalog.
Tips
Make sure your return policy mentions deposit fees so customers know what to expect
Train staff on the correct process to ensure deposits are refunded consistently