Managing direct cancellations of Booking .com reservations

Salem Orion had a question about canceled bookings when the guests cancel directly with you instead of modifying the reservation through Booking .com:

How are you all able to resell the beds after a guest has said they are not coming on Booking.con reservations?
The guest hasn't canceled their reservation through booking but in a massage to us. 
Booking keeps the reservation until the day they are supposed to arrive and that is killing my availability. 
Help please.

Cracker Skyner provided this solution:

Hit the 'request to cancel reservation' button. When they ask you why, just copy email into there.
 

Beata Baltavari suggested making a screenshot of the cancellation request and sending it to Booking support. 

Ania Topka suggested calling Booking support directly.

Ronnette Lucraft and Cathrin Eszbach both suggested creating a "ghost" room in their PMS that doesn't exist in the hostel. Any reservations pending cancellation could be moved to this virtual room in order to free up the real beds for sale again.

A warning from Arben Jonuzi: 

when the booking sends you the invoice at the end of the month, have a look just in case they charge you for this reservation.
...
If a guest request from us to cancel their reservation, we always advice them to make the request from B.com for free cancellation. In this case it is a free cancellation and we don't charge them since the guest is not a noshow. If the guest doesn't know how to do that, we just Request to cancel the reservation (picture posted by Cracker Skyner above). If the fee for that reservation is included in the invoice when we get at the end of the month,we dispute it and they always remove it . In case b.com has any questions regarding that dispute, we have the email from the guest.

Erik Erikson offered another solution:

We are using the exclusive program from Booking.com // Booking.com always take the payment from the guests, keep the commission and in the end of the month, send us a bank transfer with our payment. It's a 17.5 % contract. It's not virtual cards.
This way, we don't need to worry for invalid cards or no-show (and no payments). It's hard to get to that program, as you need to prove that you don't accept credit cards but if you have a good account manager and willing to re-start your profile, it's an easy option.
At Expedia, we are using only Expedia Collect option for 18%.

How do you handle it when a guest wants to cancel the reservation they made through Booking .com directly with you?