You can process a refund by editing a paid order.
Find the order you wish to provide a refund for and edit the order, click on the blue pencil associated to that order.
When you do this, a 'Refund' button will appear on the orange banner as indicated below.
When you click on the 'Refund' button, you can choose to refund a specific amount or the full amount. You can even refund a % of the total amount.
You will then be given the option to refund to the original payment method or you can add the amount refunded as credit to the customer's account. When you do this, you will be asked to provide a reason as to why this refund is being made.
All that is left is to click on submit - the refund will then come into effect!
Another way of refunding orders it to go to the SEARCH page. If you search for a specific order on that page, you will find the ability to refund orders from there too as evidenced below. This way of refunding can be particularly useful for those of you who would like some of your staff members to do refunds, but not edit paid orders.
Please note that if Stripe is the payment processor that you are currently using, you will also need to make sure that you process the refund via Stripe's dashboard to ensure that the funds are refunded to the customer's account.