This article will show you the step-by-step to cancel direct reservations created from within the system (walk-in, phone, email, mybookings booking engine) or manually added third party reservation (wholesaler, corporate client, offline travel agent, etc).
For reservations coming from the distribution channels or Online Travel Agencies (OTAs), the cancellation process can be different depending on the channel. Please follow the detailed instructions in the following article: How to Cancel/Modify Reservation Made on OTA
- Changing the reservation status to Cancelled does not automatically zero out the reservation balance due.
- The amount of pending transactions (charges scheduled for future dates) remaining in the balance due doesn't affect revenue reports.
- Cancelling the reservation does not automatically refund any payment processed for the guest.
Contents:
Step 1. Check your cancellation policy
Depending on your property's policy, there are different ways to settle the cancellation:
- Charge your guest for the cancellation
- Refund the deposit back to the guest for refundable reservations
- Zero out the balance due in the folio if you don't charge anything for a cancelled reservation
Regardless of the three options above, your guests must be informed about your Property's Cancellation Policy, whether or not they will be charged when they cancel their reservation.
Follow the instructions to set up Cancellation Policy: How to set up Cancellation Policy
There are 2 ways to add a charge for cancellation:
- Cancellation manual revenue (recommended)
- Cancellation fee
Cancellation Revenue will be considered in reports as part of room revenue/RevPar, while cancellation fee will be considered as a separate item and won't be included in room revenue/RevPar.
- Go to reservation folio and click Add/Adjust Charge
- Select Add Room Revenue
- Select revenue type: Cancellation - and fill in all the necessary information. You can also apply a tax/fee on top of this charge.
- Click Continue
- The charge will appear in the folio and will affect the balance due
After that, you can add the guest payment as necessary. Follow the instructions How to Process Payment in Cloudbeds PMS
- Create a fee on the Taxes and Fees page, and name it as Cancellation Fee. See article to learn how to create fees: Taxes & Fees - Everything you need to know
- On the reservation folio click Add Adjust Charge
- Select Add Exclusive Tax/Fee
- Select Cancellation Fee and enter the amount of fee
- Click Add
- The fee will be added to the folio under the debit column and will affect balance due:
After that, you can add the guest payment as necessary. Follow the instructions How to Process Payment in Cloudbeds PMS
Your property may have a policy to return any collected deposit (payment) when the guest cancelled within the free (flexible) cancellation period. You can refund the deposit the same way you collected them:
A. Refund the deposit using the payment gateway
If you charged the guest credit card using the payment processor you can refund the payment by using the same method. Follow the step-by-step in this guide: How to Process Refund Through Payment Gateway
B. Refund the deposit without using the payment gateway
If the deposit payment was not processed by using the payment processor but only recorded in the system, you shall refund it using the same method by following the instructions in this article: How to Add / Post Refund to Reservation as a Record (Without Using Payment Gateway Processing)
Although the amount of pending transactions (charges scheduled for future dates) remaining in the balance due doesn't affect revenue reports, some properties prefer to zero the balance out so that their property staff is aware that the guest shouldn't pay for his stay since he cancelled the reservation.
- Amount of pending transactions (room rates) remaining in balance due won't affect the revenue reports.
- Amount of pending transactions (room rates) remaining in balance due will still be displayed when exporting reservations to file and in Account Balances report.
- If the reservation at any point was changed to In-house before it was Cancelled, any posted transactions including debit (charges) will remain in the folio and balance due.
Follow steps to zero out the balance due:
- Open the reservation and go to Accommodation
- Click Edit Price
- Put 0.00 as the price for all dates
- Click Save Updates
- Now balance due equals to 0.00
Proceed to Step 2 below.
Step 2. Change the reservation status to Cancelled
- Open the reservation and change its status to Cancelled
![[Demo] Bali Jungle, Resort - Reservations](https://media.screensteps.com/image_assets/assets/004/165/081/original/d1038a0b-0852-4e90-a343-3f1c04a60e0d.png)
- Click Continue and select how to proceed with the cancellation (whether you'd like to email the guest):
- Confirm Cancellation
- Cancel and Email Guest
- Cancel and Email Guest (without rates)
![[Demo] Bali Jungle, Resort - Reservations](https://media.screensteps.com/image_assets/assets/004/069/379/original/dcb4ee2f-6656-400c-8e94-15f2aa040f2c.png)
You can edit the Cancellation email on the Email Templates settings.
- After confirming the cancellation
- The reservation will disappear from the calendar.
- All pending transactions (charges scheduled for future dates) will be removed from folio BUT will remain in the balance due.
- Amount of pending transactions (room rates) remaining in balance due won't affect the revenue reports.
- Amount of pending transactions (room rates) remaining in balance due will still be displayed when exporting reservations to file and in Account Balances report.
- If the reservation at any point was changed to In-house before it was Cancelled, any posted transactions including debit (charges) will remain in the folio and balance due.
![[Demo] Bali Jungle, Resort - Reservations](https://media.screensteps.com/image_assets/assets/004/069/382/original/62111044-a8f3-4bb9-8384-4eeeaf06a90f.png)
You can check the date of cancellation by moving your mouse towards the Cancellation # field on reservation details:
![[Demo] Bali Jungle, Resort - Reservations](https://media.screensteps.com/image_assets/assets/004/069/384/original/4f1d77ba-ebc8-45c7-91b1-bff926703e18.png)
In case you are not using Cloudbeds PMS and have chosen to work with the Booking Engine (mybookings) only (together with myallocator or not) the cancellation process is different.
In this case, restrictions are applied, and you will not be able to change the status of a reservation to Cancelled. If you receive a cancellation request for a reservation that was imported through your website you will have 2 options:
- Go to the Availability Matrix.
- Find the period of the existing reservation and add one extra room available, i.e, if current availability is 0 - you will have to change to 1; if current availability is 2 - you will have to change it to 3.
- Double check if it's correct and save it.
If you are not using any PMS, it is recommended to create an internal process for cases like this so your reception team know that the booking was cancelled.
Since you are adding an extra room available, this will cause a fake overbooking because you are saying that you have more rooms available than your total inventory.
Because of that, if you choose to work with option 1, you will have to allow overbookings. Click here to learn more about Allow overbooking option.
By deleting the reservation, you will lose all the information related to that guest from your database and it cannot be undone (information cannot be recovered).
If you don't feel confident working with overbookings, this option is for you:
- In the Reservations section, find the booking.
- Double check the details to make sure you will delete the correct one.
- Click x to delete the reservation.
No. The act of cancelling a reservation doesn't affect transactions that have been processed and posted in the folio, meaning that the posted transactions will remain there.
If you want to make a refund, you need to do it manually. Here is the article which describes the process of making a refund: How to Process Refund Through Payment Gateway
Only scheduled payment (pending transaction) will be voided when the reservation is cancelled since the scheduled payment is not yet processed and posted in the folio.
