Best way to refund without incurring a defect?

A question about : Best way to refund without incurring a defect?

I just received an item back today which had been posted on 11th November to Bulgaria. What is the best way to refund the buyer, I don't want a defect!

Best answers:

• Can you refund after 60 days?
  I'd leave it on the shelf until they get in touch.
• Send them a Payment request for the postal cost & resend it back to them, as you cannot refund the payment.
• What is a 'defect'? I looked idly at my 'Seller dashboard' and was surprised to find I was listed as having one defect. But I have 100% positive feedback, how do I find out what this defect was?