Under the Australian Consumer Law you are entitled to a refund when a product has a major failure (it is unsafe, very different from its description, or has a serious fault that would have stopped you buying it), or when a minor fault is not fixed in a reasonable time. You choose between a refund and a replacement, the business you paid must provide it, and a “no refunds” policy cannot take that right away. You are not entitled to a refund just because you changed your mind, unless the store’s own policy offers one.
When Australian Consumer Law gives you a right to a refund
The Australian Consumer Law (ACL) is Schedule 2 of the Competition and Consumer Act 2010. It gives every consumer automatic rights called consumer guarantees. They apply whether or not the business offers a warranty, and a contract term that tries to exclude them is void (section 64).
For products, the main consumer guarantees are that goods:
- are of acceptable quality: safe, durable, free from defects and acceptable in appearance and finish (section 54)
- are fit for any purpose you told the seller about (section 55)
- match their description (section 56) and any sample or demonstration model (section 57)
Services must be provided with due care and skill (section 60), be fit for any purpose you made known (section 61) and be supplied in a reasonable time when no date was agreed (section 62).
You count as a consumer if the goods or services are of a kind normally bought for personal, domestic or household use, whatever the price. A business can be a consumer too: the ACCC’s consumer rights page states that purchases of up to $100,000 including GST are covered, except goods bought to resell or to use up or transform in production, manufacture or repairs (section 3).
Major or minor failure: who chooses the remedy
Whether you can insist on a refund depends on whether the problem is a major failure. For goods, section 260 says a failure is major if a reasonable consumer would not have bought the goods knowing about it, the goods depart significantly from their description or sample, they are substantially unfit for their normal purpose (or a purpose you told the seller about) and cannot easily be fixed in a reasonable time, or they are unsafe. Several smaller faults can add up to a major failure.
| Situation | What the law allows |
|---|---|
| Goods with a major failure | You can reject the goods and choose a refund or a replacement of the same type (sections 259(3) and 263), or keep them and claim compensation for the drop in value. |
| Goods with a minor failure | The business chooses whether to repair, replace or refund (section 261). If it refuses or takes too long, you can reject the goods, or have them fixed elsewhere and recover the reasonable cost (section 259(2)). |
| Services with a major failure | You can cancel the contract or keep it and claim compensation for the drop in value (section 267(3)). If you paid upfront, the ACCC says you can get some money back, depending on how much of the service was provided without problems. |
| Services with a minor failure | The business must fix the problem. If it refuses or takes too long, you can have someone else fix it and recover the reasonable cost, or cancel (section 267(2)). |
A refund for rejected goods must be the full amount you paid, and the ACCC states the business must not deduct anything for the use you have had. You can also claim reasonably foreseeable losses caused by the failure (sections 259(4) and 267(4)). The ACCC’s repair, replace, refund, cancel page has examples. Your demand is clearest when a written refund demand letter names the failure and the remedy you choose.
Ready to put it in writing?
Answer 3 quick questions to check you have the details your document needs, and see your next step.
1. Who owes you?
2. How much?
3. Do you have it in writing?
Your result is ready. Where should we send it?
When a business can lawfully refuse a refund
According to the ACCC, you are not entitled to a repair, replacement or refund if:
- you simply changed your mind, found it cheaper elsewhere or no longer want it (a business with a change of mind policy must still follow that policy)
- you caused the problem by misusing the product
- you were told about the problem before you bought it
- you asked for a service to be done a certain way against the business’s advice, or someone other than the business caused the problem
Section 262 also stops you rejecting goods once the “rejection period” has ended (the time in which it is reasonable to expect the fault to show up), or if you lost, destroyed or disposed of the goods, they were damaged after delivery for reasons unrelated to the fault, or they have been fixed to other property and cannot be removed undamaged. Most consumer guarantees for goods, including acceptable quality, do not apply to sales by auction (sections 54 to 57).
Refund excuses that do not hold up
- “No refunds” or “no refunds on sale items”. The ACCC says it is illegal for a business to rely on policies like these to deny your rights, and misrepresenting your rights or remedies can breach section 29(1)(m). See our guide on why “no refunds” signs are illegal.
- “Take it up with the manufacturer.” The ACCC states that businesses must not send you to the manufacturer.
- “The warranty has expired.” A warranty is an extra promise on top of the consumer guarantees, which last for a reasonable time and can continue after the warranty ends. See our appliance fault guide.
- “Store credit only.” A business cannot satisfy a refund for rejected goods by letting you buy other goods from it (section 263(5)). The ACCC says refunds should go back in the original form of payment unless you agree otherwise.
- “It is not in the original packaging.” You can take action whether or not the goods are in their original packaging (section 259(7)).
- “No receipt, no refund.” A business can ask for proof of purchase, but the ACCC lists a credit or debit card statement, a lay-by agreement, a receipt or reference number and a warranty card as other forms of proof.
- “It was a gift.” A person who receives goods as a gift has the same rights as the buyer (section 266).
How to demand a refund, step by step
- Gather evidence: proof of purchase, photos of the fault, the product description and your messages with the business.
- Work out whether the failure is major or minor using the tests above, and decide what remedy you want.
- Contact the business. The ACCC suggests telling them you believe there is a major failure under the consumer guarantees in the Australian Consumer Law, that you reject the product, and whether you want a refund or a replacement.
- Put it in writing. Describe the product, purchase date and price, the fault, the consumer guarantee not met, the remedy you choose and a reasonable date to respond. Attach copies of your evidence.
- Return the goods if asked. You return items that can be posted or easily carried. For large, heavy or installed items, the business must collect them at its own expense (section 263(3)). If the fault is confirmed, the ACCC says the business must repay your reasonable return costs.
- Escalate if there is no fair response by that date.
The ACCC publishes a complaint letter tool on its contacting a business page, and Consumer Affairs Victoria offers a template letter. For a formal letter prepared around your facts, a Consumer Guarantee Letter names the consumer guarantees in issue, states whether the failure is major or minor and sets out the remedy you are requesting. For a deeper look at each consumer guarantee, see our Australian Consumer Law guide.
What to do if the business still won’t refund your money
- Your state or territory consumer protection agency. The ACCC says these agencies can give you information about your rights and may help negotiate a resolution. They include NSW Fair Trading, Consumer Affairs Victoria and the Queensland Office of Fair Trading, which says it contacts each party to try to resolve a lodged complaint. The ACCC lists every state and territory agency on its where to go for consumer help page.
- An industry ombudsman. Some industries have their own scheme, such as the Telecommunications Industry Ombudsman, the Australian Financial Complaints Authority and the state energy ombudsmen.
- A chargeback. If you paid by credit card, Consumer Affairs Victoria suggests asking your bank or card provider for a chargeback. Act quickly, as time limits apply.
- A small claims tribunal or court. Each state and territory has one that hears consumer disputes, for example NCAT in New South Wales, VCAT in Victoria and QCAT in Queensland. Check the tribunal’s website before you apply.
- A report to the ACCC. The ACCC does not resolve individual disputes, but it uses reports to inform its compliance and enforcement work.
See also our guides for an online order that never arrived, a cancelled concert or event and a gym that won’t let you cancel.
Frequently asked questions
Can I get a refund under Australian Consumer Law if I just changed my mind?
No. The consumer guarantees cover faults, not changes of mind. If a store has its own change of mind policy, it must follow it.
Does a business have to give a refund or can it offer store credit?
For a major failure, you choose a refund or a replacement, and a refund for rejected goods cannot be satisfied by letting you buy other goods from the business (section 263(5)). You can accept a credit note, but you do not have to.
How long do I have to ask for a refund on faulty goods?
There is no fixed number of days. The consumer guarantees last for as long as is reasonable for that product, considering what it is, its price and how it was used. Your right to reject goods ends once the rejection period has passed (section 262), so raise the problem as soon as you notice it.
What can I do if a business won’t refund my money?
Put your demand in writing with a response date. If that fails, contact your fair trading agency or an industry ombudsman, ask about a credit card chargeback, or apply to a small claims tribunal or court.
Do I need the original receipt to get a refund?
No. A business can ask for proof of purchase, but a credit or debit card statement, a receipt or reference number, or a lay-by agreement can also do.
Claim Done prepares a Consumer Guarantee Letter demanding a refund, replacement or repair from your answers for $49. You check it, download it and send it to the business yourself. It is a document preparation service, not legal advice, and Claim Done does not represent you.
What happens when you send a Consumer Guarantee Letter
Same problem. What a prepared case looks like.