How Smart Policies Automatically Post Cancellation and No-Show Fees in Cloudbeds PMS

Lorena Pamplona

Updated October 29, 2026 17:43

Overview

Cloudbeds Smart Policies can automatically calculate and post cancellation and no-show fees to a reservation's folio. This helps properties apply their configured policies consistently and reduces the need to calculate and add penalties manually.

When an eligible reservation is canceled or marked as no-show, Cloudbeds determines the applicable penalty using the Smart Policy assigned to the reservation. Depending on the configuration, the penalty may include applicable taxes and fees.

Cancellation and no-show fees are recorded separately from regular accommodation revenue, helping properties track and reconcile these transactions.

Purpose	Understand how Smart Policies calculate and automatically post cancellation and no-show penalties to reservation folios.
Best for	Front Desk, Property Managers, General Managers, PMS Administrators, and Night Audit staff.
Use this when	Configuring cancellation or no-show penalties, reviewing automatic folio entries, handling fee overrides, or investigating missing or unexpected charges.
Requirements	An eligible property with Smart Policies enabled, an applicable Smart Policy assigned to the reservation, and active automation for the relevant workflow.
Expected result	Eligible cancellation and no-show penalties are calculated and posted to the reservation folio according to the assigned Smart Policy.
Limitations	Smart Policies are available to eligible properties. Automatic posting requires reservation eligibility and active automation. Guest Portal cancellations support Smart Policy cancellation rules for credit cards and digital payments. Posting a fee does not guarantee successful payment collection.

Availability: Smart Policies are available to eligible properties. To learn more about eligibility, contact Cloudbeds Support.

Folio posting and payment collection are separate operations. A cancellation or no-show fee may appear on the reservation folio even when the guest's card has not been successfully charged. Always review payment history before attempting another transaction.

Requirements for automatic fee posting

Automatic cancellation and no-show fee posting depends on the Smart Policy assigned to the reservation and whether the reservation qualifies for automation.

Before relying on automatic fee posting, confirm that:

Smart Policies are enabled: The property must have access to Smart Policies.
An applicable policy is assigned: The reservation must have a Smart Policy that defines the relevant cancellation or no-show terms.
Automation is active: Smart Policy automation must be enabled for the reservation.
The reservation is eligible: The reservation must meet the requirements for automatic posting.
A penalty applies: The configured policy must produce a nonzero cancellation or no-show fee.

Smart Policies primarily apply to eligible direct reservations, including reservations created through the Booking Engine and manually in Cloudbeds PMS.

OTA reservations continue to follow their applicable channel deposit and payment rules.

Automation disabled: If Smart Policy automation has been turned off for a reservation, Cloudbeds will not automatically post its cancellation or no-show penalty. Staff must manage any applicable fees and financial transactions manually.

For gateway requirements and supported payment automation, see Smart Policies and Payment Gateways.

Configure cancellation and no-show fees

Before Cloudbeds can calculate and post a penalty, the property's Smart Policy must define the applicable cancellation and no-show conditions.

Go to Settings > Policies.
Open the Payment & Cancelation tab.
Create a Smart Policy or open an existing policy to edit it.
Review the Cancellation Policy settings and configure the cancellation terms.
Review the No-show Policy settings. Choose whether the no-show fee follows the cancellation policy or uses a custom amount.
Configure the taxes and fees applicable to cancellation and no-show penalties.
Review the automatic posting indication and save the Smart Policy.

For complete configuration instructions, see Set up Smart Policies.

Configure taxes and fees for penalties

Smart Policies allow properties to determine which taxes and fees apply to cancellation and no-show penalties. These selections are configured separately for each penalty type.

For each cancellation or no-show policy, choose one of the following options:

All applicable taxes and fees: Include all taxes and fees applicable under the policy.
Custom set: Select the specific taxes and fees that should apply to the penalty.
None: Do not add policy taxes or fees to the penalty.

Cancellation and no-show penalties can use different tax and fee selections, even within the same Smart Policy.

Existing Smart Policies retain their current tax and fee behavior until their configuration is updated.

How automatic fee posting works

When an eligible reservation is canceled or marked as no-show, Cloudbeds evaluates the assigned Smart Policy and determines whether a penalty should be posted.

The applicable workflow depends on the reservation status change. Expand the sections below to review how each scenario works.

When a reservation is canceled

When a reservation with active Smart Policy automation is canceled, Cloudbeds determines the applicable cancellation penalty using the policy assigned to the reservation.

During the cancellation workflow in Cloudbeds PMS, the confirmation window provides information about the applicable financial outcome.

Cloudbeds calculates the cancellation fee according to the reservation's cancellation terms.
Applicable policy taxes and fees are included according to the Smart Policy configuration.
The confirmation window indicates the amount that will be posted to the folio.
If the reservation is eligible, Cloudbeds automatically posts the confirmed fee.
Any eligible card charge or refund is handled separately from the folio entry.

Cancellations made through the Guest Portal also apply the relevant Smart Policy cancellation rules for supported credit card and digital payment workflows. See Guest Portal cancellations for details.

Review existing folio transactions before cancellation. Charges and payments already posted to the folio are not automatically reversed when a cancellation penalty is added.

When a reservation is marked as no-show

When a reservation is marked as No-show, Cloudbeds uses the no-show terms defined in the assigned Smart Policy to determine the applicable penalty.

The no-show fee may follow the cancellation policy or use a separately configured amount.

The policy applies when the reservation is marked as no-show:

Manually by property staff;
By a connected system; or
During the nightly audit.

For eligible reservations with active automation, Cloudbeds posts the applicable no-show fee and configured policy taxes and fees to the folio.

How penalty amounts are calculated

The amount posted to the reservation folio depends on the calculation method configured in the applicable Smart Policy.

Calculation method	How the penalty is determined
Percentage	A percentage of the applicable reservation amount.
First night's price	The applicable accommodation price for the first night.
Fixed amount	The fixed monetary amount configured in the Smart Policy.

For percentage-based and first-night penalties, applicable policy taxes and fees are calculated according to the configured tax and fee selection.

Fixed cancellation or no-show penalties are posted as a single fee amount without additional policy taxes and fees.

If the calculated penalty is zero, there is no cancellation or no-show fee to post.

Calculation example

Expand the example below to see how a percentage-based cancellation penalty and selected tax could affect the amount posted to the folio.

Example: Percentage-based cancellation penalty

Consider a three-night reservation with the following charges:

Accommodation: $100 per night
Total accommodation before taxes: $300
VAT: 10%
City tax: 5%
Total reservation amount: $345

The Smart Policy defines a 50% cancellation penalty, with VAT selected as the applicable penalty tax and city tax excluded.

Calculation	Amount
Accommodation penalty: 50% of $300	$150.00
VAT on penalty: 10% of $150	$15.00
City tax	$0.00
Total cancellation penalty	$165.00

In this example, the total cancellation penalty is $165.00, consisting of the accommodation penalty and the selected VAT.

Folio transactions and payment processing

Automatically posting a penalty does not necessarily complete all financial activity associated with a cancellation or no-show.

Properties should distinguish between charges recorded on the reservation folio and actual payment transactions.

What happens to existing folio charges and payments

When Cloudbeds posts a cancellation or no-show fee, it does not automatically reverse all existing financial activity on the reservation.

Previously posted charges: Charges already posted remain on the folio unless separately adjusted or voided.
Payments already collected: Received payments remain recorded on the folio.
Unposted charges: Future or unposted reservation charges follow the standard folio behavior for the reservation status change.

Late cancellations: If accommodation charges and their taxes have already been posted, adding a cancellation penalty may leave both the original charges and the penalty on the folio. Review the folio and make any necessary manual adjustments to avoid unintended charges.

If a canceled reservation is later reinstated, the previously posted cancellation fee is not automatically reversed.

Review the folio and adjust the fee manually if required.

How card charges and refunds work

Automatic folio posting and card payment processing are separate operations.

Depending on the amount already paid and the property's payment automation, Cloudbeds may attempt to charge the guest or process a refund after the cancellation or no-show outcome is determined.

A fee can appear on the folio before the related payment action is completed.
If an automated card charge fails, the posted fee remains on the folio and the outstanding balance must be managed.
A posted fee does not confirm that a card transaction succeeded.
Staff should review the folio and payment history before attempting another charge or issuing a refund.

Payment processing may not occur at exactly the same moment as folio posting. Review the payment transaction status before taking further action.

For gateway-specific automation capabilities, see Smart Policies and Payment Gateways.

Special scenarios and fee overrides

Some reservation workflows require additional review or behave differently from standard automatic fee posting.

Expand the sections below to understand how Smart Policies handle multi-room reservations, fee overrides, duplicate penalties, and Guest Portal cancellations.

How fees are posted for multi-room reservations

For reservations containing multiple rooms, applicable cancellation and no-show fees are distributed across the individual rooms.

After the reservation is canceled or marked as no-show, review the resulting folio entries to confirm the charges associated with each room.

Override or waive cancellation and no-show fees

Authorized staff can override the applicable cancellation or no-show penalty during the corresponding reservation workflow.

The ability to override these fees is controlled through role permissions.

Override cancellation fee: Allows authorized users to waive a Smart Policy cancellation penalty.
Override no-show fee: Allows authorized users to waive a Smart Policy no-show penalty.

When a fee is overridden, the user must provide a reason. The override is recorded in the reservation activity history.

A waived automatic fee is not posted to the folio.

Waiving and adjusting fees are different actions. Waiving a fee during cancellation or no-show prevents the automatic penalty from being posted. A fee already posted to the folio must be managed through the appropriate folio adjustment workflow.

How Cloudbeds prevents duplicate penalties

Cloudbeds includes duplicate fee protection to prevent multiple automatic cancellation or no-show penalties from being posted for the same room.

If a valid automatic fee has already been posted, subsequent status changes do not create another automatic penalty for that same room.

A fee that was waived and therefore not posted does not count as a previously posted penalty.

If a penalty does not appear after a later status change, review the reservation folio and activity history to determine whether an automatic fee was previously posted.

What happens when a guest cancels through the Guest Portal

When a guest cancels an eligible reservation through the Guest Portal, the applicable Smart Policy cancellation rules are applied.

This functionality supports credit cards and digital payments. Guest Portal cancellations are not automatically excluded from Smart Policy financial automation.

Any applicable cancellation penalty is determined by the reservation's Smart Policy. The resulting financial actions depend on the policy, reservation eligibility, and payment configuration.

Property staff should review the reservation folio and payment history to confirm the outcome before manually charging or refunding the guest.

Guest Portal cancellations and Smart Policies: Supported Guest Portal cancellations apply the configured cancellation rules. Do not assume that staff must always process the penalty manually. Check the folio and payment transactions to determine whether further action is necessary.

Reporting and revenue classification

Cancellation and no-show fees posted to the folio are categorized separately from regular accommodation revenue.

Cancellation fees: Recorded as cancellation revenue.
No-show fees: Recorded as no-show revenue.

Use the applicable financial reports to review these revenue categories and reconcile the corresponding folio transactions.

Troubleshooting automatic fee posting

If a cancellation or no-show fee is missing, appears incorrect, or remains unpaid, use the following checks to identify the possible cause and next action.

Scenario	What to check
Fee was not automatically posted	Confirm that Smart Policy automation was active, the reservation was eligible, and the applicable policy defined a nonzero penalty.
Fee amount differs from expectations	Review the assigned Smart Policy, penalty calculation method, and applicable tax and fee selections.
Fee is posted but remains unpaid	Review payment transaction history. Folio posting does not guarantee successful card collection.
Original charges and penalty both appear	Check whether accommodation charges had already posted before cancellation or no-show. Adjust existing charges manually if necessary.
Guest Portal cancellation has no expected automatic fee	Guest Portal cancellations support Smart Policy cancellation rules for credit cards and digital payments. Confirm the assigned policy, reservation eligibility, automation status, payment configuration, folio entries, and transaction history before taking manual action.
Fee was not posted after an override	Review reservation activity history to confirm whether an authorized user waived the fee.
Fee does not post after another status change	Check whether an automatic cancellation or no-show penalty was already posted for the same room.

If the issue remains unresolved after these checks, review the reservation's Smart Policy configuration, folio transactions, and activity history before contacting Cloudbeds Support.

Understanding how fees are calculated, posted, and collected helps your team manage cancellations and no-shows consistently while avoiding unintended charges or duplicate payment actions.

Explore these resources to learn more about Smart Policies, their configuration, and how they interact with reservations and payments.