diff --git a/app/paddle_callback.py b/app/paddle_callback.py
new file mode 100644
index 00000000..7d7402a7
--- /dev/null
+++ b/app/paddle_callback.py
@@ -0,0 +1,32 @@
+import arrow
+
+from app.db import Session
+from app.email_utils import send_email, render
+from app.log import LOG
+from app.models import Subscription
+from app import paddle_utils
+
+
+def failed_payment(sub: Subscription, subscription_id: str):
+    LOG.w(
+        "Subscription failed payment %s for %s (sub %s)",
+        subscription_id,
+        sub.user,
+        sub.id,
+    )
+
+    sub.cancelled = True
+    Session.commit()
+
+    user = sub.user
+
+    paddle_utils.cancel_subscription(subscription_id)
+
+    send_email(
+        user.email,
+        "SimpleLogin - your subscription has failed to be renewed",
+        render(
+            "transactional/subscription-cancel.txt",
+            end_date=arrow.arrow.datetime.utcnow(),
+        ),
+    )
diff --git a/server.py b/server.py
index 5e183c58..f34e9f12 100644
--- a/server.py
+++ b/server.py
@@ -29,7 +29,7 @@ from sentry_sdk.integrations.flask import FlaskIntegration
 from sentry_sdk.integrations.sqlalchemy import SqlalchemyIntegration
 from werkzeug.middleware.proxy_fix import ProxyFix
 
-from app import paddle_utils, config
+from app import paddle_utils, config, paddle_callback
 from app.admin_model import (
     SLAdminIndexView,
     UserAdmin,
@@ -543,6 +543,11 @@ def setup_paddle_callback(app: Flask):
 
             sub: Subscription = Subscription.get_by(subscription_id=subscription_id)
             if sub:
+                next_bill_date = request.form.get("next_bill_date")
+                if not next_bill_date:
+                    paddle_callback.failed_payment(sub, subscription_id)
+                    return "OK"
+
                 LOG.d(
                     "Update subscription %s %s on %s, next bill date %s",
                     subscription_id,
diff --git a/tests/test_paddle_callback.py b/tests/test_paddle_callback.py
new file mode 100644
index 00000000..a81d8ce7
--- /dev/null
+++ b/tests/test_paddle_callback.py
@@ -0,0 +1,33 @@
+import arrow
+
+from app import paddle_callback
+from app.db import Session
+from app.mail_sender import mail_sender
+from app.models import Subscription, PlanEnum
+from tests.utils import create_new_user, random_token
+
+
+@mail_sender.store_emails_test_decorator
+def test_failed_payments():
+    user = create_new_user()
+    paddle_sub_id = random_token()
+    sub = Subscription.create(
+        user_id=user.id,
+        cancel_url="https://checkout.paddle.com/subscription/cancel?user=1234",
+        update_url="https://checkout.paddle.com/subscription/update?user=1234",
+        subscription_id=paddle_sub_id,
+        event_time=arrow.now(),
+        next_bill_date=arrow.now().shift(days=10).date(),
+        plan=PlanEnum.monthly,
+        commit=True,
+    )
+    Session.commit()
+
+    paddle_callback.failed_payment(sub, paddle_sub_id)
+
+    sub = Subscription.get_by(subscription_id=paddle_sub_id)
+    assert sub.cancelled
+
+    assert 1 == len(mail_sender.get_stored_emails())
+    mail_sent = mail_sender.get_stored_emails()[0]
+    assert mail_sent.envelope_to == user.email