Amazon's Returnless Refund and Partial Refund Changes

In brief: Amazon returnless refunds and partial refunds both changed in 2021, on seller-fulfilled (FBM) orders. From 9 August 2021, a new refund workflow let sellers grade returned items and issue partial refunds — but only for items returned out of policy, used or damaged, and only with a photo uploaded. Full refunds remained due for in-policy returns in original condition, within two working days of receiving the return. From 5 October 2021, sellers shipping Amazon.co.uk orders from outside the UK had to offer a domestic return address or a returnless refund for orders under £20 (under €25 on Amazon.de, .fr, .it and .es). Without a UK return address, Amazon would refund the customer automatically without the item coming back.

Returnless refunds and partial refunds on Amazon

From	Change
9 August 2021	Partial refunds require grading the return and uploading a photo; refund calculator in Seller Central
5 October 2021	Cross-border FBM orders under £20 / €25: local return address or returnless refund

A worked example

An overseas seller ships 600 UK orders a month averaging £12, with a 5% return rate. Without a UK return address, about 30 orders a month are refunded without the goods coming back — £360 of refunds (30 × £12) plus the cost of 30 units that are simply lost.

What it means for your bookkeeping

• Returnless refunds are two costs. The refund reduces sales, and the unreturned item is a stock loss. Record both.

• Partial refunds reduce sales by the amount refunded. Keep the grading and photos — they're the evidence behind the adjustment.

• VAT: refunds reduce output VAT in the period the refund is made.

• Speed matters. The two-working-day refund rule means refunds land quickly, often in the next settlement.

• Where it shows up. Refunds reduce the payout in the period they're made — see reconciling an Amazon settlement and which VAT return boxes they affect.

How TrueBooks helps

TrueBooks posts every refund from your Amazon settlements to Xero with the right UK VAT in the period it happens, whether full or partial. See the Amazon Xero integration.