Cancel a booking and make a refund if necessary

If you are facing a booking cancellation and might need to make a refund to the guest. It depends on various conditions ranging from used payment methods to policy, how you will need to handle the cancellation, and process the refund. In the following article, we will list several use cases that will give you a better insight into how to handle each individual situation.

💡 Notes:

• So you can stay on top of all your reservations, guests cannot cancel the booking themselves. This will always need to be handled on the owner/rental agency side.
• Bookings imported from external channels need to be canceled and refunded in the following way:

Read about:

• Use case 1: Booking with an enabled Policy & Quote workflow paid with a credit card and automatic refund activated
• Use case 2: Booking with an enabled Policy & Quote workflow, either paid with a credit card but automatic refund deactivated or paid with Paypal, etc.
• Use case 3: Booking without Policy & Quote workflow paid with a credit card and automatic refund activated

🔎 Use case 1: Booking with an enabled Policy & Quote workflow paid with a credit card and automatic refund activated

If you want to cancel and refund a booking with the following charasterictics:

• The booking has an active Policy & Quote workflow,
• You have activated the automatic refund function in your credit card gateway,
• The booking was paid with a credit card,

Then you need to follow the below steps to cancel the booking and thus trigger the automatic refund.

💡 Note: The automatic refund is only available for Lodgify bookings that have been made through your website, or created manually.

As the refund is triggered automatically, you need to make sure you select the correct way of cancellation in order to refund the correct amount of money to your guest.

💡 Note: A partial refund is not possible when the automatic refund function is activated.

To cancel and refund, follow these steps:

1. Go to your Main Menu in the top left corner and select Reservations.
2. Select the booking that you want to cancel.
3. In the Quote box, click on the Status Agreed and select to either Cancel and refund all payments (Owner cancels), or Guest cancels.
4. The Message slider appears where you can edit the email template if needed and click Send to inform your guest of the cancellation. The scheduled refund will be done automatically but it could take up to 4 hours to see the refund done.

🔎 Use case 2: Booking with an enabled Policy & Quote workflow, either paid with a credit card but automatic refund deactivated or paid with Paypal, etc.

If you want to cancel and refund a booking with the following charasterictics:

• The booking has an active Policy & Quote workflow,
• You have activated the automatic refund function in your credit card gateway but the booking was not paid with a credit card,
• You did not activate the automatic refund function,

Then you need to follow the below steps to cancel the booking and refund.

For bookings with an active Policy & Quote workflow, the system automatically calculates the amount that needs to be refunded depending on the cancellation policy.

1. Go to your Main Menu in the top left corner and select Reservations.
2. Select the booking that you want to cancel.
3. In the Quote box, click on the Status Agreed and select to either Cancel and refund all payments (Owner cancels), or Guest cancels.
4. The Message slider appears where you can edit the email template if needed and click Send to inform your guest of the cancellation. 
5. Now you need to make a manual refund. To issue the refund, go to the Payment collection box and click the + icon next to the transaction you want to refund.

   If the booking was paid by...	then...
   Credit card	Select Issue Refund. 💡 Note: Mark as refunded only serves to update your transaction record with a refund. A new window slides in where you can see the amount the system automatically calculated according to the cancellation policy. 💡 Note: This amount cannot be changed. In case you prefer to refund a bigger amount, you will need to make an additional refund afterward. Then tick the box to confirm that your payment gateway (Stripe, Braintree, Authorize.Net, or Lodgify Payments) will refund the confirmed amount to the guest.  A new window opens up to send a message to your guest and notify him of the issued refund.
   Paypal, Bank Transfer, or Cash 💡 Note: In this case, refunds in the Lodgify Reservation System are currently only to ensure your Transaction Records are up-to-date and reflect your payments received/refunded correctly. You will still need to make the actual payment to your guest via one of the channels mentioned above.	Refund your client. Select Mark as refunded. A new window slides in where you can insert the amount that you refunded. A new window opens up to send a message to your guest and notify him of the refund you issued.

🔎 Use case 3: Booking without Policy & Quote workflow paid with a credit card and automatic refund activated

If you want to cancel and refund a booking with the following charasterictics:

1. The booking has no active Policy & Quote workflow,
2. You have activated the automatic refund function in your credit card gateway,
3. The booking was paid with a credit card,

OR

1. The booking has no active Policy & Quote workflow,
2. You have activated the automatic refund function in your credit card gateway, but the booking was not paid with a credit card,
3. You have the automatic refund deactivated

Then follow the below steps to cancel the booking.

💡 Note: Please be aware that without an active policy, no automatic refunds can be made, so you will need to make the refund manually.

1. Go to your Main Menu in the top left corner and select Reservations.
2. Select the booking that you want to cancel.
3. Click on the booking status (Booked) and select Decline from the drop-down menu.
4. The Message slider appears where you can edit the email template if needed. Click Send to inform your guest of the cancellation.
   💡 Note: This automated email notification will only appear if you have this option activated in your Email Notification Settings.
5. As the Policy & Quote Workflow is deactivated you won't receive any notifications requesting to refund money to the client, so all refunds will need to be handled manually. To issue the refund, go to the Payment collection box and click the + icon next to the transaction you want to refund.

   If the booking was paid by...	then...
   Credit card	Select Issue Refund. 💡 Note: Mark as refunded only serves to update your transaction record with a refund. A new window slides in where you can insert the amount you want to refund. Then tick the box to confirm that your payment gateway (Stripe, Braintree, Authorize.Net, or Lodgify Payments) will refund the confirmed amount to the guest.  A new window opens up to send a message to your guest and notify him of the issued refund.
   Paypal, Bank Transfer, or Cash 💡 Note: In this case, refunds in the Lodgify Reservation System are currently only to ensure your Transaction Records are up-to-date and reflect your payments received/refunded correctly. You will still need to make the actual payment to your guest via one of the channels mentioned above.	Select Mark as refunded. A new window slides in where you can insert the amount that you refunded. A new window opens up to send a message to your guest and notify him of the refund you issued.