If I remember correctly (and if they haven’t changed their policies), I think the transaction fee is only taken from the seller. No fee is deducted from the buyer. That should include refunds.

However, sellers usually do not refund any shipping and handling fees.

You need to go through their refund process though. If you simply give their money back as a separate transaction, they will be the recipient and will have the PayPal fee deducted from their amount. And it would mess up a whole bunch of stuff. (Like having proof that you refunded them.) You want to keep all of that linked together.

[eBay Store Owner Here]

@Nimis Is correct.

The seller will lose a percentage of the transaction, however the person on the receiving end will get their full amount back.