You can easily manage refunds using this WooCommerce refund plugin. You can create a simple and powerful refund management system and notify your administration and customers through emails. Merchants can create refund email templates for each scenario, such as accepted, rejected, processed, to send to customers. Moreover, based on the refund policy, customers can ask for partial or complete refunds.
This plugin also simplifies managing tax on refunds, you can either include or exclude them by configuring the settings. It also has a premium version available.