Written for online shops in the UK selling on their own site or on marketplaces: direct-to-consumer brands, private-label and FBA sellers, dropshippers and subscription sellers.
The short version
- Allow 14 days from delivery to cancel.Then refund within 14 days of getting the goods back, or proof of posting if sooner, standard delivery included (As of Oct 2026).
- Grade each return and deduct only real loss.Real loss means value lost to handling beyond what a shop would allow. Grade within two working days and keep photos. No flat fees.
- Treat faulty goods and lost parcels separately.Faulty goods rejected within 30 days of delivery: full refund. A parcel is your risk until the customer has it (As of Oct 2026).
When you sell online to consumers, two sets of rules write your returns policy before you do. The Consumer Contracts Regulations give a right to cancel for any reason. The Consumer Rights Act gives separate rights when goods are faulty, not as described, or never arrive. A term that takes away the Consumer Rights Act rights does not bind the customer, so 'no refunds on sale items' does not survive.
The right to cancel
14 days to cancel, 14 days to refund
For goods, the cancellation period normally ends 14 days after the day the customer gets physical possession; for an order delivered in parts, from the last delivery. You refund everything paid, including outbound delivery up to the cheapest common standard option you offered, within 14 days of getting the goods back or, if earlier, the customer's evidence of sending them, by the same payment method unless the customer agrees otherwise, and with no fee. As of Oct 2026.
Consumer Contracts Regulations 2013 (SI 2013/3134) regs 30 and 34
- Before the order, give your identity, geographic address, the total price including delivery, the cancellation conditions with the model cancellation form, and who pays return costs.
- The order button must say 'order with obligation to pay' or something equivalent, or the customer is not bound.
- Send confirmation on a durable medium by the time of delivery at the latest.
- The customer pays return postage only if you said so before the contract and did not offer to pay it.
- Leave out the cancellation information and the period ends 12 months after the normal 14 days would have ended (or 14 days after you supply the information, if sooner), and you lose any right to deduct for handling.
The regulations allow a deduction only for diminished value, up to the price, never a flat fee, and grading fast keeps you inside the 14-day refund clock.
| Price paid | £240 |
| Standard delivery paid | £6.95 |
| Less loss in value: now resells at £180 as B-grade | -£60 |
| Less a replacement descale kit | -£8 |
| Refund due within 14 days | £178.95 |
Worked example. If the cancellation information was missing, there is no deduction and the refund is £246.95. If the customer rejects it as faulty within 30 days of delivery, the faulty-goods rules apply instead: a full refund with no deduction.
Goods with no right to cancel
There is no right to cancel for goods made to the customer's specification or clearly personalised, goods that deteriorate rapidly, sealed goods unsuitable for return for health or hygiene reasons once unsealed, goods inseparably mixed with other items after delivery, and sealed audio, video or software once unsealed. The faulty-goods rights still apply to all of them, so a wrongly engraved watch gets full remedies. As of Oct 2026.
Consumer Contracts Regulations 2013 reg 28
Faulty goods and lost parcels
The 30-day right to reject
Goods must be of satisfactory quality, fit for a purpose the customer made known, and as described, and your listing is part of the contract. The customer can reject faulty goods within 30 days of delivery (shorter for perishable goods) for a full refund with no deduction for use, and you bear the reasonable cost of return. A fault that shows within 6 months is presumed to have been there at delivery unless you prove otherwise. As of Oct 2026.
Consumer Rights Act 2015 ss.9 to 12, 19(14), 20 and 22(3) and (4)
Delivery within 30 days unless you agreed otherwise
Deliver without undue delay and within 30 days of the contract unless you agreed another period. If you miss a date that was essential, the customer can treat the contract as at an end; otherwise they can set a further reasonable period and end it if that is missed too. As of Oct 2026.
Consumer Rights Act 2015 s.28(3), (6) and (7)
A parcel is at your risk until the customer has it
Goods stay at your risk until they come into the physical possession of the customer or someone the customer identified. A 'delivered' scan to a doorstep the customer did not nominate is your loss. Risk passes on handover to a carrier only when the customer chose a carrier you did not offer. As of Oct 2026.
Consumer Rights Act 2015 s.29(2), (4) and (5)
So when a customer who did not nominate a safe place says a parcel marked delivered never came, replace or refund now and claim from the courier under your own contract. Do not send the customer to the courier.
Subscriptions are about to change
The new subscription rules in the Digital Markets, Competition and Consumers Act 2024 are not yet in force; the government has announced them for January 2027. They bring pre-contract information, renewal and trial reminders, a 14-day cooling-off right at the start and again after a free or discounted trial ends or a contract of 12 months or more renews, and straightforward exit, online where the customer signed up online. Start rebuilding sign-up, reminder and exit flows now. As of Oct 2026.
The two clocks people mix up: 14 days is the deadline to refund a cancellation, and 30 days is the customer's short-term right to reject faulty goods. Writing 'refund within 30 days' in your policy gets the first one wrong.
Asked in Greymill
A flat restocking fee is not allowed. You can deduct only the real loss in value from handling beyond what a shop would allow:
Paid: £240.00 + £6.95 delivery = £246.95
Less loss in value: £240 minus £180 resale = £60.00
Less the missing descale kit: £8.00
Refund: £178.95
You keep £68. Your fee plus the delivery would have kept £42.95.
Deadline: refund within 14 days of getting it back, or of their proof of posting if earlier (As of Oct 2026). Grade returns within 2 working days and keep photos and notes.
Two catches:
Cancellation information missing from your site? No deduction: refund £246.95.
Customer says it is faulty? Then faulty-goods rules apply: rejected within 30 days of delivery (As of Oct 2026), it is a full refund, no deduction.
Next, I can redraft your returns policy around this.
Ask it about your own business
Paste this into Greymill with your own figures, and Contracts & Disputes works it through for your business.
I run an online shop in the UK. Review my returns and refunds policy against the Consumer Contracts Regulations and the Consumer Rights Act, and redraft it. Here is my current policy: [paste]. I sell [products], including [any personalised, perishable or sealed items], and I [do or do not] pay return postage.
More for online retail and ecommerce in the UK
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- Paying for stock and ads weeks before the platforms pay youBuild a 13-week cash flow on each platform's real payout timing, allow for reserves, holds and chargebacks, and price any revenue-based advance before you sign.Read the lesson
- VAT when you sell on marketplaces, ship from abroad or sell into the EUWho accounts for VAT on each kind of online sale, what is changing for parcels of £135 or less (As of Oct 2026), and how to test whether the Flat Rate Scheme suits a reseller.Read the lesson
- Making sure what you import, own-brand or dropship is legal to sellIf you import, own-brand or dropship, the law can treat you as the producer: what that means for safety duties, markings, category paperwork and packaging.Read the lesson
- Staffing the Christmas peak with agency pickers, temps and freelancersBlack Friday to the January returns needs extra hands: the agency, pay, safety and freelancer rules that apply to an online shop's peak team.Read the lesson
- Getting reviews, creator posts and email sales without a fineReviews, influencers, sale prices and email now carry direct fines for online shops; here is how to use each one within the rules.Read the lesson
- Amazon has suspended my account and is holding my moneyHow to get a suspended marketplace account back with one complete appeal, the notice rights you have, and how to keep trading while your money is held.Read the lesson
Open the interactive lesson · Every online retail and ecommerce lesson · What Greymill knows about the trade
Sources
The primary sources behind this lesson, checked Oct 2026.
- Sch 2; regs 10 to 13 (Cancellation and refunds: consumer contracts regulations 2013)
- reg 14(3) and (4) (Cancellation and refunds: consumer contracts regulations 2013)
- reg 16 (Cancellation and refunds: consumer contracts regulations 2013)
- reg 30(3) and (5) (Cancellation and refunds: consumer contracts regulations 2013)
- reg 28(1) (Cancellation and refunds: consumer contracts regulations 2013)
- reg 34(1) to (8) (Cancellation and refunds: consumer contracts regulations 2013)
- ss.9 to 12 (Faulty goods, delivery and risk: consumer rights act 2015)
- s.20(8), (15); s.22(3), (4) (Faulty goods, delivery and risk: consumer rights act 2015)
- ss.23 and 24(8) to (11) (Faulty goods, delivery and risk: consumer rights act 2015)
- s.19(14) and (15) (Faulty goods, delivery and risk: consumer rights act 2015)
- s.28(3), (6), (7) (Faulty goods, delivery and risk: consumer rights act 2015)
- s.29(2), (4), (5) (Faulty goods, delivery and risk: consumer rights act 2015)
- Part 3 (enforcement) and Part 4 Chapter 1 (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- Government announcement published 9 Aug 2026, "PM starts roll out of everyday fixes on the cost of living" (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- CMA207, chapter on material pricing information (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- Sch 20 paras on consumer reviews; CMA fake reviews guidance (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- Price Marking Order 2004 (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- DBT PMO guidance paras 34 and 53 (Unfair practices, pricing, reviews and subscriptions: DMCC act 2024)
- www.gov.uk (Hard cases: returns, products and marketing)
- reg 9; CPA 1987 s.2(2) (Hard cases: returns, products and marketing)
- Announcement, 1 Aug 2023 (Pitfalls that embarrass the product)
- Part 4 Chapter 2; commencement regulations (Pitfalls that embarrass the product)
- IOSS scope (Pitfalls that embarrass the product)
- s.22(3) (Pitfalls that embarrass the product)