Refund receipts are one of those annoying bookkeeping tasks most people don’t think about—until they actually need to record one. A customer returns something, or you get money back on a purchase, and suddenly you’re trying to figure out how to enter a negative amount without breaking your accounting records.
Receipt-AI takes all of that off your plate. When you send it a refund receipt, it knows immediately that this isn’t a normal purchase. It processes the refund, formats it correctly for Xero, and creates the right type of transaction—without you having to touch anything.
Here’s how it works and why the Xero side ends up as a Receive Money transaction.
Recognizing a Refund (Without You Telling It)
You don’t need to label anything or explain the situation. If the receipt shows money coming back to you, Receipt-AI automatically treats it as a refund.
In the Home Depot example:
• The amount is negative
• The vendor is recognized
• The payment method is captured
• The item being returned is listed
• The original category can be restored
You just email the receipt (or text it), and Receipt-AI figures out the rest.
The user simply texted the Home Depot receipt to Receipt-AI. Within seconds, the system extracted all the key information:
- Vendor: The Home Depot
- Date: March 3, 2025
- Amount: –$450.00
- Category Applied: Repairs and Maintenance
- Payment Method: Ending in 5465
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Item Returned:
- Bedford Shaker 18 in. W x 34.5 in. H x 24 in. D Painted White Plywood Assembled Drawer Base Cabinet
What the Home Depot Refund Receipt Looks Like in Xero (Receive Money Transaction Example)
When Receipt-AI sends a refund receipt to Xero, it appears as a fully itemized Receive Money transaction. This is the correct format for recording money being returned to your business, and Xero displays all the details in a clean, easy-to-review layout.
In this Home Depot example, Xero automatically shows:
- Vendor: The Home Depot
- Transaction Type: Receive Money (Refund)
- Date: March 3, 2025
- Reference: Auto-generated by Receipt-AI
- Refund Amount: $450.00
- Account Category: Repairs and Maintenance
Below the summary, Xero includes the exact item that was refunded:
- Bedford Shaker Drawer Base Cabinet — 1 unit at $450.00
The line item is mapped to the correct chart-of-accounts category and marked as a refund, ensuring your financial reports stay accurate and consistent.
Xero also displays the refund documentation automatically. Under Related Files, you’ll find the refund PDF that Receipt-AI uploaded through the Xero API. This keeps every refund fully documented inside Xero — no manual uploads or file searching required.
The result is a clean, audit-ready refund record that’s easy to match to your incoming bank transaction and simple to reconcile.
Reconcile the Refund in One Click (Xero Bank Feed Match)
Once the refund appears in your bank feed, Xero automatically suggests a matching Receive Money transaction created by Receipt-AI. Because the details — vendor, date, amount, and reference — are already aligned, Xero identifies the refund instantly.
In the match screen, you’ll see:
- Vendor: The Home Depot
- Reference: Receipt-AI 633 (Refund)
- Category: Repairs and Maintenance
- Amount: $450.00
Everything is already pre-matched and ready to go. All you need to do is click:
OK
And the refund is fully reconciled.
There’s no manual data entry, no adjusting categories, and no searching for documents. Receipt-AI handles the refund setup, and Xero completes the reconciliation in a single click — giving you a fast, accurate, and stress-free workflow.
