How to Handle Cancellation Fees

Some properties may include cancellation fees in their terms & conditions. This brief article presents a general suggestion on how these fees can be reflected and handled in a cancelled booking.

Before adding any fees to a booking, it is important to make sure your official terms & conditions state clearly any incurred fees and how they will be handled. To add a cancellation fee to an existing booking, you can take the following steps:

1. In the booking view, click “Add Extras” and then manually add “Cancellation Fee” or a similar description. Another possibility is to create a new Extra under Settings -> Extras -> Add new. In this case, when adding an extra within a booking, “Cancellation Fee” (or the custom name of your choice) will show in the list of preselected extras.
2. Divide the booking and move the “Cancellation Fee” extra to a new booking.
3. Cancel the original booking. In this way, any booked rooms will again be free for reservation, while the cancellation fee is still attached as a grouped booking for further processing.
4. Under the payment section of the new “Cancellation Fee” booking view you can click “Create invoice” and issue an invoice or cash receipt that will reflect the cancellation fee. Since the invoice will include all grouped bookings, the originally booked rooms will still show. The amounts just have to be set to “0”. In this way, the invoice will show the rooms/extras of the cancelled booking. Alternatively, if you prefer the reservation details not to be shown, simply select “No” under “Include grouped bookings” before proceeding.

If you have added cancellation fees as an extra in your settings, you may wish to assign a ledger code to this kind of income for accounting purposes, which can be done in Settings -> Financials -> Chart of accounts. Find out more about ledger codes in our support article about the Chart Of Accounts.