You finish it like taking off a bandaid.
RIP IT RIGHT OFF!
Seriously, no woman wants to be led on. Tell her that you just wanna be mates or best friends, but that you don't think you're compatible for a long term, romantic, intimate relationship. Let her be hurt and cry it out or whatever, and then come back to her later and be her friend after a couple months when she's had a chance to get over it.
For sure tell her that you don't want to accept the gift, and break it off. If she's a girl with a strong character, she'll probably ask you to keep it anyways, if you are good friends. In that case you can go ahead and keep it.
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