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Thomas Cook collapsed after the last negotiations failed to save the 178-year-old holiday company.
The British Civil Aviation Authority (CAA) said the tour operator "stopped the deal with an immediate deal."
It has also launched a maximum repatriation of the Peace Prize with the goal of bringing more than 150,000 British holidaymakers home.
Peter Cook's CEO, Peter Fankhauser, said the collapse of the company was "a matter of profound regret."
The failure of the tour operator puts 22,000 jobs around the world at risk, including 9,000 in the UK.
Transportation Minister Grant Shapps said the collapse of the company is "very sad news for employees and vacationers."
He urged the vacation coordinator to "understand the staff" while carrying out the "huge" mission of bringing people home.
Shapps announced that the government and CAA hired dozens of charter planes to take their customers home for free.
The emergency operation, codenamed Matterhorn, will aim to bring home the current company and vacationing British.
On Sunday, an empty plane already flew abroad and was ready to bring British tourists home on Monday.
How do vacationers go home?
According to the Department of Transportation (DfT), with Thomas Cook, who is scheduled to return to the UK for the next two weeks, all customers abroad will return home as close as possible.
Customers return to the UK on special free flights or are booked with other scheduled airlines at no additional charge.
The flight starts on Monday and details on each flight will be posted on the dedicated website as soon as they are available.
DfT added that "a few" passengers may need to book their flights home and recover their costs.
Customers urged them to reduce their vacation or not go to the airport without checking the website for more information about their return trip.
The CAA also contacted the hotel that accommodates Thomas Cook customers who have booked as part of the package and said that the accommodation costs will be covered by the government through the Air Travel Trust Fund and Atoll Islands.
The CAA stated in the statement "All Thomas Cook reservations, including airplanes and holidays, have been cancelled.
"We believe that a company with a long history of discontinued trading will be very painful for our customers and employees and our thoughts are on everyone affected by this news."
Travel expert Simon Calder told BBC News that the plane at Manchester Airport has already begun to be detained following the collapse news.
"After midnight, we saw a detention notice to Thomas Cook aircraft at some airports because of airport bills that the airport did not pay."
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Thomas Cook signed a £ 900 million rescue contract led by China's largest shareholder, Fosun, but the deal was undoubtedly due to a recent demand to raise £ 200 million for additional funding from lending banks. there was.
The holiday company spent all Sunday in conversations with lenders to obtain additional funds and seek deals, but to no avail.
The government also asked the government for financial assistance urged by trade unions and trade union groups.
But Foreign Minister Dominic Rab on Sunday told the BBC that it did not "involve systematically" at the start of the project if it did not have "strategic national interest."
Package vacation customers have Atol protection (funds paid through industrial contributions) to cover vacation and repatriation costs.
Thomas Cook blamed a series of issues, including political unrest, such as vacation destinations like Turkey, heatwaves last summer and Brexit delayed booking vacations.
However, the company faces fierce competition with online travel agencies and low cost airlines.
Also, many vacationers prepare their own vacations and do not use travel agents.
What are your rights?
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In case of package vacation, the air travel organizer's license scheme (Atol) will apply.
You may need to move to another hotel or apartment, but this scheme pays for overseas accommodation.
If the airline is no longer operating, Atol will pay for you to bring it home.
If you booked your vacation in the future, it will be refunded to the scheme.
If you booked a flight-only transaction, you should apply for a refund by applying to your travel insurance company or credit and debit card provider.
When Monarch Airlines collapsed in 2017, the government organized all stranded passengers to be brought home, whether or not Atol was applied.
Learn more about Atol protection and answer your questions
Are you Thomas Cook customer or employee? If you are affected by the issue raised here, you can contact us by email. haveyoursay@bbc.co.uk.
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