@Pia23:
Go into your inbox, click on the messages from that guest and look at the top of the screen. There will be a box that will read something like,
"Reservation canceled by {GUEST}
These dates are now open for rebooking. Your payout has also been adjusted to ${AMOUNT} for this reservation. You can always offer {GUEST} a partial or full refund in our Resolution Center."
In this scenario you can see the exact amount you are going to be paid (your payout) and then can click the box under that text to give the guest a refund if you desire. Of course, make sure that you don't give more than the payout amount that way you will not be giving back Airbnb fees the guest has to pay. You don't want to lose money in this deal.
As long as we're on the subject of losing money, some hosts do not give any refunds since the guest took your house/room off the market when they reserved it, thus preventing you from getting another potential reservation that would have actually stayed and that you would have been paid for.
My personal policy is not to give a refund unless I re-book the room, in which case I will refund the amount I received from the second person which may end up being less than the first person booked, but at least they got back something. My personal record is cancellation, re-book, cancellation, re-book. In this case two people got their money back and I still had a guest in the house so no one lost any money. All three guests were happy, as was I because I still got paid.
