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How to Refund Money on PayPal From a Gift Sent

by Alan Sembera

PayPal makes it easy to return payments sent to your account, even when the money was marked as a gift from a friend or relative. You can simply refund the original payment, effectively marking it as canceled without having to create a separate transaction. You have up to 60 days to issue a refund; after that time, your only option is to send a regular payment to the other person's PayPal address.

Step 1

Log in to your PayPal account.

Step 2

Click "Details" next to the transaction record for the gift payment.

Step 3

Click "Issue a Refund" on the Transaction Details screen.

Step 4

Fill in the "Note to Buyer" field if you wish to send a short message with the refund. Click "Continue."

Click "Issue Refund." PayPal immediately deducts the entire amount of the gift payment from your balance and returns it to the original sender.

Tip

  • If your balance doesn't cover the refund, PayPal automatically debits the difference from your confirmed bank account or credit card. The refund remains in pending status until the funds clear. If you have no backup funding method, the refund remains in pending status until you add money to your PayPal account.

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