You refund the original purchase price including the out going postage costs.
To recover you selling fees you will need to request a transaction cancellation.
Your refunded buyer will have 3 options
1 accept
2 decline
3 ignore
They need to accept.
Once they have accepted the transaction is cancelled and you will get your selling fees back from eBay less the original listing fee which is non refundable.
Inform your buyer about the cancellation request and emphersis that it will not affect their account in anyway.
