A deposit dispute with a service provider

A deposit dispute starts with why the booking ended and what the payment secured. The words 'non-refundable' do not by themselves resolve whether a consumer cancellation term is fair. CMA guidance explains that retained payments and cancellation charges require justification. ^[1]

Reconstruct the booking and cancellation Keep the quotation, booking conditions, payment receipt and cancellation notice. Identify whether you cancelled, the provider cancelled or the provider could not deliver the agreed service. Those situations may produce different rights.

Ask for a breakdown of the amount retained. Separate work actually completed, materials obtained for your booking and a general cancellation fee. Record whether the date or goods were resold; avoid assuming either a full refund or complete forfeiture is automatic.

Respond to the provider's calculation Challenge specific unexplained items and attach the evidence supporting your position. A request for a calculation is more useful than repeatedly demanding that the business 'be reasonable'.

Where the disagreement concerns unfinished performance, compare the deposit with the work left incomplete. Before accepting a partial return, check whether the wording creates a final settlement of the entire dispute.

Establish what the advance payment secured Identify the booked service, performance date and purpose of each payment. A small reservation deposit, payment for materials already ordered and a later instalment towards the full price may require different factual explanations. Keep the quotation, booking confirmation and schedule of payments together. Record whether the customer approved any preparatory work before the booking ended. Describing every advance as the deposit can obscure the actual dispute and make it harder to assess which work or commitment the provider says each sum covered.

Find the cancellation wording supplied at the time of booking and record how it was presented. If the provider relies on a document sent later, ask when and how it says those terms became part of the agreement. Note any agreed date change or replacement booking, retaining its conditions. The CMA explains that a signed cancellation term still needs to be fair; its presence in a document does not settle whether retaining a particular amount is justified. Avoid treating a bold non-refundable label as the complete analysis. ^[1]

Identify the event that ended the arrangement Set out who cancelled, when notice reached the other party and the reason given. Distinguish a customer changing plans from a provider refusing to perform, missing an essential date or proposing a substantially different service. If each party says the other cancelled first, preserve the sequence of messages and any remaining offer to perform. The consequences should be assessed against that sequence rather than whichever party most recently used the word cancellation in correspondence.

Explain whether the booking could still have proceeded on its agreed terms. For example, a customer declining a proposed replacement date may have a different complaint from a customer cancelling an unchanged appointment. Record any attempt to transfer the booking, reduce its scope or agree a postponement, including additional charges proposed. Do not assume that every personal reason for cancellation creates a refund entitlement. Equally, the customer's need for a different arrangement does not automatically validate every charge the provider chooses to impose.

Examine the retained sum as a calculation Ask for an itemised explanation connecting the retained amount to the cancellation. The CMA's consumer guidance discusses direct losses, which can include costs or lost profit, and reasonable steps to reduce those losses. A useful response should explain the work done, commitments made, expenses saved and any replacement business relevant to the booking. Do not restrict the enquiry to whether the provider has a receipt for the entire retained sum: an asserted loss of profit requires assessment on its own basis. [1]

Compare that explanation with the actual timing and service. Bespoke materials that cannot be reused raise different questions from stock used on another job. A replacement booking may reduce an alleged loss, but its effect depends on the circumstances rather than a simple assertion that the provider remained busy. Challenge unsupported or duplicated items individually. If a cancellation charge increases as the date approaches, ask how the applicable stage was identified and whether the resulting amount fairly reflects the relevant loss rather than operating as a penalty.

Resolve the money and the booking status together State the total paid, the amount the provider proposes to keep and the sum being requested back. Identify any part accepted for completed work while making the remaining dispute clear. If the provider offers credit for a later booking, examine its expiry, availability and conditions before responding. A credit may be useful to someone who still wants the service, but it does not necessarily meet a request for repayment. Preserve the proposal in full rather than relying on an informal assurance that the money is safe.

Confirm whether any future service, collection of materials or further instalment remains in issue. If a partial refund is offered subject to settlement wording, read that wording alongside the amount and payment date before accepting. Keep proof of any repayment and update the balance claimed. The final complaint record should explain the cancellation event and disputed calculation, allowing an adviser or dispute scheme to examine those questions without reconstructing the booking from disconnected invoices and messages.