QuickBooks Online follows the online payment policy. If your customer wants to cancel the payment he made, you can inform him that he should cancel the payment before 3 PM Pacific Standard Time. If it's beyond the cut-off time, it's possible that the status will be cancelled yet the payment will still be posted to your bank account.
I'd recommend waiting until the payment is posted to your bank account. Once posted, you can create a Refund Receipt to your customer.