Seanne
You are NOT cancelling the item you are reporting a non payer -2 different things.
Go to 'Help Contact' Type in 'unpaid item' and click search
'Report your item' will come up with a picture of your recently sold item with 'select the item you wish to report;
click on the picture of the item that's not been paid for and follow instructions. It will ask you why you want to report the item -click item not paid for. You will be asked if you want to try and resolve this with the buyer, click no and then a case in the resolution centre will be automatically opened and Ebay will take over all correspondence with the non payer. If they don't pay within 48 hours you will get your insertion fee and the money they took off in commission refunded to your account.