A partial refund policy sets out when a service business returns part of what a customer paid and keeps the rest. In Australia, such a policy can cover change-of-mind cancellations, deposits and partly completed work. It cannot remove the refund and compensation rights that the Australian Consumer Law (ACL) gives customers when a service fails. This guide explains where the line sits, how to calculate a partial refund and what clear policy wording looks like, with examples drawn from air-con cleaning.
TL;DR
- A partial refund returns some of the original payment while the customer keeps the service. Retained amounts should reflect genuine, reasonable costs or work done.
- A "non-refundable deposit" label does not make retention lawful. The amount should be proportionate to real loss and disclosed before payment.
- A "no refunds for change of mind" statement is acceptable. It does not override ACL remedies for faulty or failed services.
- Calculate the refund as the amount paid minus the value of satisfactory work done and documented, lawful costs.
- Record every refund against the original transaction and never refund more than was paid.
Table of Contents
- What a partial refund is
- What Australian Consumer Law requires
- Deposits and cancellation fees
- Cancelling part-way through a service period
- How to calculate a partial refund
- What a fair policy should cover
- Refund policy wording examples
- Perspective
- Setting up deposits and refunds with MyAirCare
- FAQ
- Sources
What a partial refund is
A partial refund returns part of a charge. Stripe's guidance on partial refunds describes it as returning some but not all of the original payment while the customer keeps the product or service. Several partial refunds can be issued against one payment, provided the total does not exceed the amount paid.
In practice a service business meets partial refunds in four situations:
- A customer cancels with short notice and the business keeps a fee for lost time.
- A job is stopped part-way and only the completed portion is charged.
- A service had a problem and the price is reduced to reflect it.
- The business chooses to give a goodwill amount back to settle a complaint.
The first two depend mostly on the contract. The third is often a legal remedy. The fourth is a commercial decision.
What Australian Consumer Law requires
The central distinction is between a customer changing their mind and a service failing a consumer guarantee. business.gov.au explains the ACL on this basis: a change of mind does not require a refund, while a failure triggers repair, price reduction, cancellation or refund rights depending on severity.
Change of mind
The Queensland Law Handbook notes that retailers are not legally obliged to give a refund for every return, and the same logic applies to services: a simple change of mind does not generally create a refund right. The ACCC confirms that a business may state that refunds are not given when a customer simply changes their mind. Its small-business guidance adds that such a statement does not displace statutory remedies for services that fail the consumer guarantees.
Service failures
The ACCC lists the service guarantees as due care and skill, fitness for a specified purpose, and supply within a reasonable time when no time was set. The remedy depends on the size of the problem:
- Minor failure: the provider normally gets a reasonable opportunity to fix it. If it does not, the consumer may obtain a refund or cancel as the ACL permits.
- Major failure: the consumer can cancel and obtain a refund for the unconsumed portion, or keep the contract and seek compensation for reduced value.
The ACCC states that businesses cannot rely on "no refunds" terms to deny a remedy for faulty services. For a major problem, the ACCC's business guidance describes a refund less a reasonable amount for work done as expected, or keeping the contract at a lower price that takes the problem into account. That is a partial refund by operation of law.
Deposits and cancellation fees
Deposits are where most partial refund questions arise. Consumer Affairs Victoria says prepayments are generally refundable after cancellation, less actual or reasonable costs incurred before cancellation. Its guidance is written for tourism businesses, but the principle of proportionate loss applies to any service that takes bookings.
Is a non-refundable deposit legal in Australia?
Calling an amount non-refundable does not itself make keeping it lawful. Sprintlaw's guidance on non-refundable deposits states that the amount should be proportionate to genuine loss and the terms clear and upfront. Lawpath's 2026 guidance lists the factors that decide whether all or part of a deposit can be kept:
- the contract terms
- the purpose of the payment
- the reason for cancellation
- work already completed
- costs that cannot be recovered
- the ability to rebook the slot
Lawpath also notes there is no universal percentage suitable for every service. A partial refund may be appropriate when the actual loss is lower than the deposit, and rebooking a cancelled appointment should reduce the amount retained.
Penalties and unfair terms
Consumer Affairs Victoria warns that cancellation fees should reflect reasonable costs, because excessive charges may be penalties that are not enforceable. It also says cancellation, deposit and fee terms should be disclosed before booking and must be fair, and that unfair terms are void.
The ACCC's unfair contract terms guide gives two examples of potentially unfair terms: those that prevent a consumer cancelling regardless of the business's conduct, and those that let one party terminate without reasonably necessary protection of legitimate interests. Clear writing alone is not enough. A plainly worded clause can still be unfair if it creates a significant imbalance or is not reasonably necessary to protect a legitimate interest.
Why the slot matters
For an air-con cleaner, the legitimate interest behind a deposit is usually a held time slot, travel planned around it and a technician who could have been booked elsewhere. That interest is real only when the calendar reflects it. Systems that prevent double bookings help keep each reserved slot genuinely reserved, which makes a retained fee easier to explain and defend. A deposit taken at the time of booking, for a clearly displayed amount, also supports this. The MyAirCare guide on how to take deposits online covers the practical side, and the guide on showing every fee before payment covers disclosure on the booking page.
Cancelling part-way through a service period
A partial refund is not automatically required merely because a customer cancels part-way through. Regplain's Australian legal guidance says the obligation usually depends on the contract, on whether the service was not delivered, or on whether it failed. Where the service was delivered as promised and the customer cancels early, there is generally no statutory pro-rata refund right.
This matters for businesses that sell multi-visit or prepaid packages, such as scheduled maintenance cleans. The contract should state what happens to unused visits, and the policy should separate voluntary cancellation from service failure.
How to calculate a partial refund
The ACCC's consumer guarantees guidance on cancelling a service points to a method based on value delivered. The steps below follow it.
- Confirm the amount paid. Include deposits, part payments and any balance.
- Value the satisfactory work completed. Use the agreed hourly rate, completed milestones or an evidenced proportion of a fixed fee.
- Add documented costs the contract lawfully allows the business to keep. Examples include a call-out charge or a booked-and-unfilled slot, supported by records.
- Refund the difference. The refund is the amount paid minus the total from steps 2 and 3.
- Do not bill a further balance unless the contract and the law support it.
Worked example
A customer pays a $100 deposit for a split-system clean. The customer cancels the evening before. The terms, shown at booking, say that cancellation under 24 hours' notice incurs a fee covering the held slot. The business holds records showing the slot could not be refilled and that it was reasonable to keep $50. The refund is $50. If the slot is rebooked the next morning, the business's loss has fallen and the retained amount should fall with it.
The figures are illustrative only. The right amounts depend on actual costs and the contract.
Processing the refund
Stripe says refunds should normally return to the original card, bank account or wallet, and the refund cannot exceed the original settled transaction. It recommends recording each partial refund against the original transaction and checking that the cumulative total stays within the customer's payment, which keeps reconciliation clean. Businesses that take payments through the booking system can handle this from one record. For failed or declined charges, the guide on failed payment recovery sets out the related steps.
What a fair policy should cover
Lawpath lists the elements of a deposit and refund policy. A service business can use them as a checklist:
- the deposit amount and its purpose
- whether the deposit is credited to the final price
- refund triggers
- cancellation and rescheduling notice periods
- no-show treatment
- charges for completed work and unrecoverable costs
- what happens if the business cancels
- a statement preserving ACL rights
The terms should be presented clearly before booking or payment. For home services, Sprintlaw's booking terms guidance adds booking confirmation, call-out fees, quotes, delays, customer preparation, additional work, complaints and return visits. The MyAirCare guides on call-out fee policy and booking confirmation emails show how these terms reach the customer in writing.
A refund policy can set out what a business offers beyond the legal minimum. Legal123's policy wording guide notes it cannot deny consumer guarantee rights, and a blanket "no refunds" policy cannot override them.
Refund policy wording examples
Sprintlaw's cancellation policy examples show tiered wording, provided the amounts reasonably reflect likely loss. The table adapts that structure.
| Situation | Example wording | Purpose |
|---|---|---|
| Early cancellation | Cancellations more than 48 hours before the booking: deposit refunded. | Shows no loss was suffered |
| Short notice | Cancellations 24 to 48 hours before: 50% fee. | Covers partial loss of the slot |
| Late or no-show | Within 24 hours or no-show: 100% fee. | Covers the unfilled slot, if reasonable |
| Business cancels | If we cancel, we will offer a rescheduled booking or refund prepaid amounts. | Protects the customer |
| Legal rights | Nothing in this policy limits your rights under the Australian Consumer Law. | Preserves ACL remedies |
The percentages and time windows are examples. A business sets its own after working out what a lost slot genuinely costs. Higher tiers such as a full fee need the strongest justification, and a lawyer or the relevant state fair trading office can confirm whether specific terms are suitable. The MyAirCare guide to cancellation emails to customers provides wording for communicating a cancellation once the policy applies.
Perspective
We built MyAirCare from experience running an air conditioning cleaning business, and refund disputes were never about the money alone. They came from terms the customer had not seen, or a fee that did not match what had actually been lost.
Our view is that a partial refund policy works best when it is part of the booking, not a page nobody reads. The deposit amount, the notice period and the refund outcome are shown before payment, and the payment is recorded against the job. That is the approach our software is designed to support: online booking, payments through Stripe, automated reminders and job records with before and after documentation in one place.
Records make partial refunds easier to calculate and easier to explain. When the calendar shows a held slot and the job notes show work completed, the retained amount can be tied to facts. Operators who run under their own brand, without franchise royalties, set these terms themselves, and clear terms are part of running that brand well.
Lewis
Setting up deposits and refunds with MyAirCare
MyAirCare gives air-con cleaning businesses branded booking pages, service-term customisation, secure Stripe payments, quotes and invoices, and a mobile app for on-site payments and job records. These features support a refund policy that is displayed at booking and applied consistently. The Free plan costs $0 per month and is supported by booking fees. MyAirCare Pro is $199 per month. Current plan details are on the MyAirCare pricing page.
Operators who are starting out can also look at the MyAirCare Business in a Box package, listed at $24,990 one-off, which combines equipment, training, software, business setup and launch support. For a wider view of the platform, the MyAirCare home page summarises the tools.
FAQ
Can a business keep a non-refundable deposit in Australia?
Only in part, and only if the amount is proportionate to genuine loss and the terms were clear before payment. Calling a deposit non-refundable does not by itself make keeping it lawful. If the business's loss is lower than the deposit, for example because the slot was rebooked, a partial refund may be appropriate.
Is a "no refunds" sign legal for services?
A sign saying refunds will not be given when a customer changes their mind is acceptable under ACCC guidance. A blanket "no refunds" statement is not, because it cannot deny remedies for services that fail the consumer guarantees.
When must a service provider give a refund even if the policy says no?
When the service has a major failure, the customer can cancel and receive a refund for the unconsumed portion, or keep the service and seek compensation for reduced value. For a minor failure, the provider normally gets a chance to fix it first. If it does not, the customer may obtain a refund or cancel as the ACL permits.
Does a customer who cancels part-way through get a pro-rata refund?
Not automatically. The answer usually depends on the contract and on whether the service was delivered as promised. Where it was delivered and the customer simply cancels early, there is generally no statutory pro-rata refund right.
Sources
- Repair, replace, refund, cancel (ACCC, business)
- Repair, replace, refund, cancel (ACCC, consumers)
- Personal services industry guide (ACCC)
- Consumer guarantees guide (ACCC)
- Unfair contract terms guide (ACCC)
- Small business rights and responsibilities (ACCC)
- Australian Consumer Law and your business (business.gov.au)
- Guidance for tourism businesses (Consumer Affairs Victoria)
- Refunds (Queensland Law Handbook)
- Partial refunds guide (Stripe)
- Non-refundable deposits legality (Sprintlaw)
- Booking terms for home services (Sprintlaw)
- Cancellation policy template and examples (Sprintlaw)
- Are non-refundable deposits legal? (Lawpath)
- Prorated refund on cancellation (Regplain)
- Refund policy wording examples (Legal123)
- How to prevent double bookings (InspectProHQ)