Refunds with Split Pay Accounts

This article applies to Classic Commerce. (Looking for Contextual Commerce documentation?)

Overview

In a situation where you have a split account, your partner takes a certain percentage of the sales or a certain percentage of the revenue that is left after the FastSpring fee. We often get asked what happens when a refund happens in this circumstance. To answer this question, we will use two examples, based on the way you have asked us to set up your split accounts.

Option 1: Fixed Percent of Sale Price

Let us say that the customer paid $100 for your product and that your partner gets a 70% split. $100 will go into your account, and then part of it comes out for the FastSpring fee. For the sake of this example, suppose the FastSpring fee was $5.00. (Your actual fees may vary.) So $5.00 would come out of the $100 order, leaving $95.00. Then your partner's 70% split would be deducted next and paid into their account; that is, ($100 x 0.70), or $70. This would leave ($95 - $70), or $25, credited to your account.

If there is a full refund, the $70 is removed from your partner's account and put back into your account. The FastSpring fee of $5.00 is also put back into your account, so now you have the original $75 (that is, $100 minus your $25 share). Then $100 (including your $25) is returned to the customer, and there is a 3.5% return fee - in this case ($100 * 0.035), or $3.50, assessed to your company.

Option 2: Fixed Percent of the Revenue

Let us say that the customer paid $100 for your product and that your partner gets a 70% split. $100 will go into your account, and then part of it comes out for the FastSpring fee. For the sake of this example, suppose the FastSpring fee was $5.00. (Your actual fees may vary.) So $5.00 would come out of the $100 order, leaving $95.00. Then your partner's 70% split would be deducted next and paid into their account; that is, ($95 x 0.70), or $66.50. This would leave ($95 - $66.50), or $28.50, credited to your account.

If there is a full refund, the $66.50 is removed from your partner's account and put back into your account. The FastSpring fee of $5.00 is also put back into your account, so now you have the original $71.50 (that is, $100 minus your $28.50 share). Then $100 (including your $28.50) is returned to the customer, and there is a 3.5% return fee - in this case ($100 * 0.035), or $3.50, assessed to your company.

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