If you go to your shop payment account and hover over the quick tips in the upper right of the page, it will bring up a menu. The instruction for issuing a refund are there.
Basically, you go to your sold order and click on receipt. On the lower half of the page on the right hand side you'll see Manage Order. If you hover over that you'll see "Issue Refund" or "Cancel Order".
I had to do a partial refund for shipping on my very first order and it is really easy.