Non-refundable or refundable deposit: which to use
Both words describe the same money. Which one is right depends on what a cancellation actually costs you, and when.
What the word is deciding
Refundable and non-refundable look like two kinds of deposit. They are one deposit and two answers to the same question: if this booking disappears, who absorbs what you have already committed? Everything else follows from that answer, so it is worth settling before you reach for either word.
The question only lives in the gap between the day the money arrives and the day you deliver. A booking taken a year out has a long gap and a great deal can change inside it. A booking taken a fortnight out barely has one. The same policy cannot be right at both ends of that range, which is the first clue that the honest answer is rarely one word for every customer.
When non-refundable is the honest choice
Non-refundable belongs where the money is effectively spent the moment it lands. You pass a deposit straight on to a caterer. You order materials cut to someone's measurements. You take a date off the calendar and stop answering other enquiries for it. In each case the deposit is not waiting in your account; it has already turned into something you cannot get back.
The test is resale. If the booking collapsed today, could you sell what you reserved to somebody else? A Saturday eighteen months out usually finds another buyer. A Saturday ten days out usually does not, and the deposit is the only part of that date you will ever see.
Where you do use the word, give it a reason in the same sentence. The deposit is non-refundable because it covers the supplier we book on your behalf as soon as the date is held: that is read once and accepted. The bare word with nothing behind it reads as a trap, and it gets argued about at exactly the moment you least want an argument, which is after a cancellation, by email, with somebody who is already upset.
When refundable costs you less than it looks
Refundable is right when very little of your own money moves before the day. A class with a waiting list, a rental item back on the shelf, a programme with spare places. If a cancellation two months out costs you an hour of admin, a policy written as though it costs you the whole fee is one you will quietly ignore the first time somebody asks nicely.
A refundable deposit is also doing a different job. It is not compensation. It is proof the booking is real, a card on file, and the first date on a schedule. All three survive being refundable; the money is the least important part of them.
And refundable almost never means refundable forever. Nearly every version that works in practice is refundable up to a point and firmer after it, because your exposure genuinely changes as the date gets close. Saying so is not a loophole. It is a description of your own calendar.
The version most bookings actually want
In practice the useful policy is neither word on its own. It is a short ladder tied to the date: fully refundable up to a stated day, part of it held after that, none of it returned inside the last stretch when you can no longer resell. Three steps are plenty. Five is a document nobody finishes reading.
Write the ladder as dates rather than conditions, and work back from the day you deliver instead of forward from the day they booked. Cancel more than sixty days out and the deposit comes back in full, inside sixty days we keep half, inside twenty-one days it stays with us: that is checkable against a calendar. Refunds at our discretion depending on circumstances is a sentence that will cost you an afternoon one day.
Then say what happens to the instalments, not only the deposit. Every payment after the first is money for something that still has not happened, so a customer who has paid three of five is owed an answer that a deposit policy alone does not give. Decide whether later payments follow the same ladder or come back whole, and put that line beside the others.
One last test before you publish either word. Read it out loud as though the customer were sitting in front of you. If you would say it in a room, it is the right policy. If you would soften it, change the policy rather than the sentence. The version you would actually say is the one you can stand behind months later.