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# How do I issue a refund for returned goods?

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You can issue a refund for returned goods by:

*   Directly initiating a refund for an Invoice; or
*   Creating a Credit Note.

#### Directly initiating a refund for an Invoice

Whenever your customer returns your goods, you don’t necessarily have to create a credit note and apply it to the invoices that are created in the future. You can also record a refund for the return of goods. In order to do that, kindly follow the below mentioned steps:

*   Go to **Invoices** under _Sales_.
*   Select the invoice for which you would like to record a refund.
*   Click on the _More_ drop-down in the invoice and select the **Create Credit Note** options.
*   Click **Save**.
*   A Credit Note will be created for the invoice amount.
*   Click on the **More** drop-down and select the **Refund** option.
*   Enter the amount and choose a payment method.
*   Click **Save** to record the refund.

#### Creating a Credit Note

A refund for goods returned to you or cancellation of plans by the customer can be issued in the form of a Credit Note. You can create a credit note for the invoice you wish to refund and apply it to the invoices that are created in the future.

When a customer partially or fully returns the goods you’ve supplied to him,

*   Go to the _Invoices_ section on the left sidebar and open the corresponding invoice that represents this transaction.
*   Click **More** and select **Create Credit Note**.
*   Under item details, specify the exact quantity that has been returned, and create the credit note.
*   You can apply this credit note to the invoices that you create in the future.