@Jaqueline8 I agree; the way they explained it is confusing. Here is what I believe they are trying to tell you:
If you did NOT agree to refund any more than 50%: you would receive £421 the day after the guest would have checked in. (For illustration's sake, let's say this is Dec 2).
If you DID agree to refund 100%: Airbnb would deduct £421 from whatever payments you next have coming (let's say, from your upcoming July 21 payment). Then, on Dec 2 they would send you the £421 back.
It does seem silly, but I think that's what they are saying would happen.
I am not sure why they do it this way.