Etsy refund fees: which fees you get back when you refund an order
When you refund an Etsy order through Shop Manager, Etsy gives back the transaction fee and the payment processing fee for what you refunded. The $0.20 listing fee only comes back if you also cancel the order. On a $25 order with $5 shipping, a full refund leaves you out $0.20 in fees, or nothing if you cancel.
Below are the rules, then the same order refunded in full and in part, line by line. The rules come from Etsy's Help Center, checked on October 19, 2026, using the fees for a seller with a US bank account.
Which Etsy fees come back on a refund
| Fee | On a refund |
|---|---|
| Transaction fee (6.5%) | Credited for the refunded transaction, automatically, to your Payment account. |
| Payment processing fee (3% + $0.25 in the US) | Credited proportionally to the amount you refund. |
| Listing fee ($0.20) | Only credited if you also cancel the order. A refund on its own doesn't cancel it. |
| Offsite Ads fee (15% or 12%) | The Etsy pages we checked don't say. Look at the order in your Payment account. |
Two conditions apply. The refund has to go through Shop Manager with Etsy Payments, and within 180 days of the payment. After 180 days you can only refund outside Etsy, for example through PayPal, and then Etsy doesn't give back any seller fees.
The money for the refund comes out of your Payment account. If there isn't enough there, Etsy charges the rest to the card on file.
The order we'll refund
A buyer orders a $25 print and pays $5 for shipping: $30 in total, before any sales tax.
| Line | Math | Amount |
|---|---|---|
| Buyer pays | $25 + $5 | $30.00 |
| Listing fee | flat | -$0.20 |
| Transaction fee | 6.5% × $30 | -$1.95 |
| Payment processing | 3% × $30 + $0.25 | -$1.15 |
| Etsy deposits | $30 - $3.30 | $26.70 |
We round each fee to the cent, half-up. Your Payment account shows the exact amounts Etsy charged and credited.
Full refund: what you get back
The print arrives damaged and you refund the whole $30.
| Line | Refund only | Refund and cancel |
|---|---|---|
| You pay the buyer back | -$30.00 | -$30.00 |
| Transaction fee credited | +$1.95 | +$1.95 |
| Processing fee credited | +$1.15 | +$1.15 |
| Listing fee credited | $0.00 | +$0.20 |
| Etsy fees you still paid | $0.20 | $0.00 |
So the fees aren't what hurts on a full refund. What hurts is everything around them: the print itself if it doesn't come back, what you actually paid to ship it, and the return label if you pay for it. None of that is an Etsy fee, and none of it comes back.
If you bought the shipping label on Etsy and never used it, request a refund for the label before you cancel. Etsy's cancel checklist reminds you to do that.
Partial refund: what you get back
Now the print arrives with a small scratch and you agree to refund $10 of the $30.
- Processing fee: Etsy credits it proportionally. $10 is a third of $30, so you get back a third of $1.15: $0.38.
- Transaction fee: Etsy says it credits the transaction fee for the refunded transaction, but its help pages don't spell out the math for a partial refund. If it's proportional like processing, that's 6.5% of $10: $0.65. Check the line in your Payment account.
- Listing fee: nothing, because you don't cancel the order.
So the $10 refund costs you $9.62 after the processing credit, or $8.97 if the transaction fee also comes back in proportion.
Refunds on shipping
The 6.5% transaction fee and the processing fee are charged on the shipping you collect, not just the item. So refunding shipping, for example because you overcharged it, works like any partial refund: the processing fee on that amount comes back in proportion, and the transaction fee follows the same rule as above. Overcharged shipping and a forgotten shop coupon are two of the reasons Etsy lists for issuing a refund.
Refunding vs. canceling
On Etsy they're two different steps. A refund sends money back to the buyer. A cancellation closes the order: the buyer gets a full refund, Etsy credits the listing and transaction fees, and the sale no longer counts on your shop page.
If you refund in full and the order shouldn't stay open, cancel it too. In Shop Manager you can do both from the same refund screen by ticking Issue a full refund and then Cancel order.
Put refunds in your prices
A refund almost never costs you only the fees. If you sell physical items, it helps to think about how often you refund and to leave room for it in your price. Our post on Etsy fees in 2026, explained with one order walks through the full fee stack before any refund.
Questions
Does Etsy refund fees when you refund an order?
Yes, mostly. If you refund through Shop Manager with Etsy Payments, Etsy credits the transaction fee and the payment processing fee for what you refunded. The $0.20 listing fee only comes back if you also cancel the order.
Does Etsy refund the transaction fee on a partial refund?
Etsy says the transaction fee for the refunded transaction is credited automatically, but it doesn't publish the math for a partial refund. The processing fee is credited in proportion to the amount refunded. Your Payment account shows the exact credit.
Can I refund an Etsy order after 180 days?
Not through Etsy Payments. After 180 days you can only refund outside Etsy, for example through PayPal, and Etsy won't give back any seller fees on that refund.
Not tax or legal advice. The rules are the ones Etsy publishes on the Help Center pages listed below, checked on October 19, 2026, using US fees. Etsy's Fees & Payments Policy (last updated October 5, 2026) was last read on October 17, 2026. Etsy can change them at any time, and your Payment account is the final word on what you were charged and credited. The print and its numbers are made up. No figure here is a prediction of sales or income.
Sources
- Etsy Help, How to Issue a Full or Partial Refund For an Order. Transaction and processing fees for refunded transactions credited automatically; listing fees credited if you also cancel; refunds within 180 days; refunds outside Etsy get no fee credit; refund paid from the Payment account or the card on file. Checked 19-10-2026.
- Etsy Help, What are Payment Processing Fees for Selling on Etsy?. Processing fee credited proportionally on a refund; US 3% + 0.25 USD on the total including shipping and tax. Checked 19-10-2026.
- Etsy Help, How to Cancel a Sale. Canceling refunds the buyer in full and credits listing and transaction fees; refund unused labels first; refund and cancel are separate steps. Checked 19-10-2026.
- Etsy, Fees & Payments Policy. Listing fee $0.20, transaction fee 6.5% on price, shipping and gift wrap. Last updated 5-10-2026; read 17-10-2026.
- Etsy Help, How Etsy's Offsite Ads Work. 15% / 12% fee on attributed orders, $100 cap. The page doesn't say what happens to the fee on a refund. Checked 19-10-2026.