Understand when to use Reverse Receipt versus Refund in RMS to correct payments posted in an account. 

Refund and Reverse Receipt in RMS

Refunds and Reverse Receipt are two methods used to correct payments in RMS. Each serves a different purpose depending on whether funds need to be returned or a transaction needs to be removed.

Use this article when a payment has been posted to an account and you need to correct it, and you are not sure which of the two actions to choose. Both sit on the account toolbar alongside Void Charge, which removes a charge rather than a payment.

Before you begin, check two things: whether the money actually reached the property, and whether the receipt was posted in the current banking period. Those two answers decide the action in almost every case.

Please Note! Some Users may not see or have access to the functions mentioned in this article. CLICK HERE to find out more.

Refund in RMS

What is a Refund?

A refund is the return of a payment that has been previously received. The refunded transaction remains visible in the account. 

When to Use Refund

• When payment has been received and is now being returned. 
• When the payment was posted in a closed banking period. 
• To record outgoing payment related to a corresponding credit. 
• When returning a security deposit or bond previously paid. 
• Recommended for receipt corrections when using RMS Pay or Payment Gateways.
  • Refund is the recommended method for RMS Pay transactions and most payment gateway corrections.

For step-by-step instructions, see How to Process a Refund in RMS.

Please Note! RMS Pay is RMS's integrated payment gateway for processing credit card transactions. It falls under the category of payment gateways mentioned in this article.

Important! Refund is the recommended method for RMS Pay transactions and most payment gateway corrections. Use Reverse Receipt only when the original payment was never valid (e.g., failed cheque or direct debit) and only in the same day banking period.

Reverse Receipt in RMS

What is a Reverse Receipt?

Reverse Receipt removes the receipt from the account view, but the transaction remains recorded in financial reports for audit purposes. It is typically used when no actual funds were received.

When to use Reverse Receipt

• When the payment was received by cheque, the cheque did not clear. 
• When a receipt was processed incorrectly, and will be re-applied.
  • Recommended for corrections on the same accounting date. Do not use Reverse Receipt across different banking periods, as this can cause reporting and reconciliation discrepancies.
• When a direct debit fails, and no payment is received.

For step-by-step instructions, see How to Reverse a Receipt in RMS.

Important! Performing a Reverse Receipt on a payment taken using a Payment Gateway will physically return the funds to the credit card initially used.
Refund is the recommended method for RMS Pay transactions and most payment gateway corrections. Use Reverse Receipt only when the original payment was never valid (e.g., failed cheque or direct debit) and in the same banking period. 
Reverse Receipt is best used for same-day accounting corrections. Using it across different accounting periods causes reporting and reconciliation discrepancies.

Decision Guide: Refund vs Reverse Receipt

If you are unable to complete a Reverse Receipt because the banking period has closed, use Refund instead. If a Reverse Receipt was processed against a Payment Gateway receipt by mistake, the funds will already have been returned to the card, so treat it as a completed refund rather than reversing it again.

Refund and Reverse Receipt Examples

Refund Example 1: Credit Card

A customer paid $200 via credit card but cancelled their booking. Use Refund to return the $200 to their card.

Refund Example 2: Payment Gateway

A guest overpaid $50 via RMS Pay. Use Refund to return the excess amount to their credit card.

Reverse Receipt Example: Bounced Cheque

A cheque payment of $500 was entered, but the cheque bounced. Use Reverse Receipt to remove the transaction from the account.

Reverse Receipt Example 2: Direct Debit Failed

A direct debit failed due to insufficient funds. Use Reverse Receipt to remove the incorrect receipt from the account.