Leaving Hostaway because of the 2% booking fee?

Charging a Cancellation Fee

Setting a fixed amount or flat rate cancellation fee is an effective way to offset any additional costs to users but also to encourage a commitment to a booking, protect your vacation rental business from lost revenue, and assist with planning and scheduling.

It is also important to confirm that any additional fees are clearly communicated to guests upfront to avoid any misunderstandings or negative customer experiences.

Setting up fixed amount or flat-rate cancellation fees prior to bookings ensures that guests are aware of any additional fees associated with cancellations because those flat-rate cancellation fees are clearly outlined in your Cancellation Policy and embedded in your Rental Agreement.

But users can also set any fixed amount cancellation fees during the cancellation process and the operation is very similar as we detail below.

Set Cancellation Fee

Users should navigate to Settings > Pricing > Surcharges.

Navigate to Settings > Pricing > Surcharges.

Click on + Create Surcharge.

Click on + Create Surcharge.

In the Description section Category drop-down list, select Cancellation Fee.

In the Description section Category drop-down list, select Cancellation Fee.

Although the Description field will default to the same text as the Category field, users have the opportunity to edit the field.

By default, Cancellation Fees are applied Manually at the time of cancellation so that is already selected. 

By default, Cancellation Fees are applied Manually at the time of cancellation so that is already selected. 

In the Surcharge section, users can determine the following.

  • By default, Fixed Amount is selected in the Amount Type field.
  • Amount of fee
  • By default, Per stay is selected in the Applies section.
  • Determine whether the Cancellation Fee Is Taxable by selecting Yes or No.

In the Options section, users can decide whether the Status is Active or Categorize this as a 'rent' line item. Click on Save.

Surcharge and OptionsProperty Management users can make selections in the additional Expense and Commission sections.

PM users can determine how the Cancellation Fee Amount is distributed to either the Owner or PM and whether a commission Rate is set. Click on Save.

PM Cancellation Fee section

After the Cancellation Fee is saved, it will appear on the Surcharges page.

After the Cancellation Fee is saved, it will appear on the Surcharges page.

Set Cancellation Fee During Cancellation Process

Users can also set a Cancellation Fee "on the fly" during the cancellation process of a booking reservation.

Navigate to the booking and click on Cancel.

Users can also set a Cancellation Fee

On the Cancel Booking page, users will be reminded of their current Cancellation Policy with some additional options as to how to apply the Cancellation Policy.

  • If no Cancellation Fee is set, users can set one here by clicking on the green Add New link.

If no Cancellation Fee is set, users can set one here by clicking on the green Add New link.

  • If users already have a Cancellation Fee set, they can choose to
    • Charge No fee
    • Apply the current Cancellation Fee
    • Or add another Cancellation Fee by clicking on the green Add New link.

If users already have a Cancellation Fee set, they can choose to Charge No fee, apply the current Cancellation Fee, or add another Cancellation Fee by clicking on the green Add New link.

In the Create 'Cancellation Fee' Surcharge modal, users can do the following.

  • Add a new cancellation fee Amount.
  • Determine whether the Cancellation Fee Is Taxable by selecting Yes or No.
  • Decide whether the Status is Active or Categorize this as a 'rent' line item
  • Property Management users can make selections in the additional Expense and Commission sections.

Click Save & Apply.

Create 'Cancellation Fee' Surcharge modal

The new Cancellation Fee will appear as a selection in the Cancellation Fee drop-down list allowing users to select and apply as desired.

The new Cancellation Fee will appear as a selection in the Cancellation Fee drop-down list allowing users to select and apply as desired.