Mary Devlin was fined £30 after she was caught parked with two wheels on the pavement in Prescot , Merseyside.
Disgusted pals at the town’s Burns Bar, owned by ex-Rangers star Hugh Burns, held a whipround to cover her fine.
But Mary, 67, appealed and police have now backed down and returned the money.
She said: “It’s a nice surprise after everything that’s happened and I’ll give this to a cause that needs it more than me.”
The cash collected will go to the Armed Forces Veterans Association. Bar boss Hugh said: “We’re chuffed for Mary.”