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Draft My Refund Policy

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small business refund policy uk

Refund Policy for UK Small Businesss

A small business refund policy uk founders can actually rely on needs to do more than list a returns window. It needs to reflect your specific business model, comply with the Consumer Rights Act 2015, and be clear enough that customers and staff both understand it without calling you. Most small businesses either copy a generic template that does not match what they sell, or skip the policy entirely and deal with disputes case by case. Both approaches cost time and money. If you sell physical goods, digital products, or services, your obligations differ — and your policy needs to reflect that. Statutory rights cannot be contracted out of, but you can set out your own process on top of them. This page explains what a compliant refund policy looks like for UK small businesses, what to include, and how Atornee helps you draft one that fits your actual operation rather than a fictional average business.

Draft My Refund Policy
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Why this matters

Most small business owners write a refund policy once, paste it into a footer, and forget about it until a customer dispute forces them to read it again. The problem is that a vague or misaligned policy creates more conflict, not less. Customers quote it back at you. Payment processors ask for it. Marketplaces require it. And if it contradicts your statutory obligations under the Consumer Rights Act 2015 or the Consumer Contracts Regulations 2013, it can be unenforceable or actively misleading. Writing one from scratch is time-consuming. Hiring a solicitor for a single policy feels disproportionate. Atornee sits in the middle.

The Atornee approach

Atornee is not a template library. When you draft a refund policy through Atornee, you answer questions about your business — what you sell, how you deliver it, what your returns window is, whether you offer exchanges or store credit — and the AI builds a policy around your actual answers. You can then review it, ask questions about specific clauses, and understand what each section is doing and why. If your situation is genuinely complex — for example, you sell regulated goods or operate a subscription model with unusual terms — Atornee will flag that and tell you when a solicitor review makes sense. No upsell, just honest guidance.

What you get

A refund policy drafted around your specific business model, not a generic retail template
Plain-English explanations of what each clause means and what statutory rights it sits alongside
Coverage of physical goods, digital products, and services — with the correct legal treatment for each
Flagging of any clauses that could conflict with the Consumer Rights Act 2015 or Consumer Contracts Regulations 2013
A document you can paste directly into your website, terms of sale, or marketplace listing

Before you sign checklist

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1. List every product or service type you sell and confirm whether each is physical, digital, or a service
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2. Decide your voluntary returns window — this sits on top of statutory rights, not instead of them
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3. Confirm whether you offer refunds, exchanges, store credit, or a combination, and in what circumstances
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4. Check whether you sell to consumers, businesses, or both — your obligations differ significantly
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5. Note any exclusions you want to apply, such as personalised items or perishable goods, and verify these are legally permitted
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6. Draft your policy using Atornee, then read it against your actual checkout or sales process to check it matches
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7. If you operate a subscription or recurring billing model, flag this during drafting — cancellation rights need separate treatment

FAQ

Do I legally need a refund policy as a UK small business?

You are not legally required to publish a written refund policy, but you are legally required to honour statutory rights under the Consumer Rights Act 2015 regardless. Having a clear written policy protects you in disputes and is required by most payment processors and marketplaces. It also reduces the number of customer queries you have to handle manually.

Can I say 'no refunds' in my policy?

Not for consumer sales. Customers have statutory rights to a refund for faulty goods or services not delivered as described, and you cannot contract out of those. You can limit your voluntary refund policy — for example, not accepting returns on change-of-mind purchases for certain product types — but any clause that attempts to remove statutory rights is unenforceable and could breach consumer protection law.

What is the difference between a refund policy for goods versus services?

For physical goods sold to consumers, the Consumer Rights Act 2015 gives customers 30 days to reject faulty items for a full refund. For services, the right is to have the service repeated or to receive a price reduction if it was not carried out with reasonable care and skill. Digital content has its own rules. Your policy needs to reflect whichever applies to what you actually sell.

Does my refund policy need to cover distance selling?

Yes, if you sell online or by phone. The Consumer Contracts Regulations 2013 give consumers a 14-day cooling-off period for most distance sales, during which they can cancel without giving a reason. Your policy should state this clearly. There are exceptions — for example, personalised goods, perishable items, and digital content that has been downloaded with the customer's consent — and these should be listed explicitly.

Can I use the same refund policy for business customers and consumers?

You can, but it is not ideal. Consumer protection legislation does not apply to B2B transactions in the same way, so you have more flexibility with business customers. If you sell to both, it is cleaner to either have separate policies or clearly state which terms apply to which type of buyer. Atornee will ask you about your customer base during drafting.

When should I get a solicitor to review my refund policy rather than using AI?

For most standard small business refund policies, AI drafting with a careful review is sufficient. You should involve a solicitor if you operate in a regulated sector, sell high-value goods with complex warranty arrangements, have had a specific dispute that exposed a gap in your current policy, or are setting up a subscription model with unusual cancellation terms. Atornee will flag these situations during the drafting process.

Related Atornee Guides

Cheap Contract Solicitor Alternative (UK)

Useful if you want to understand where AI drafting fits within your broader contract workflow.

Atornee Use Cases

See how other UK small business owners use Atornee across different document types and roles.

Cheap Solicitor for NDA (UK)

Relevant if you also need confidentiality terms alongside your refund and sales documentation.

External References

GOV.UK Business and Self-employed

Official UK guidance on consumer rights obligations and business operations.

UK Legislation

Primary source for the Consumer Rights Act 2015 and Consumer Contracts Regulations 2013.

ICO Guidance for Organisations

Relevant if your refund process involves storing or processing customer personal data.

Trust & Verification Policy

Authored By

A

Atornee Editorial Team

UK Contract Research

Reviewed By

C

Compliance Review Desk

UK Business Legal Content QA

Last reviewed on 3/4/2026

"This content is based on analysis of common refund policy gaps identified across UK small business sales documentation and consumer rights disputes. It reflects the statutory framework under the Consumer Rights Act 2015 and Consumer Contracts Regulations 2013 as applied to everyday small business trading scenarios."

References & Sources