Windows: Error message "Cannot create filesystem snapshot, stopping backup here"

This error occurs on Windows 8 and higher when the "use shadow copy" box is ticked. This happens because the functionality of VSS (Volume Shadowcopy Service) got replaced with File History on Windows 8. VSS got reintroduced with Windows 10 but does not work under the same circumstances, which might cause the problem.

Once the "use shadow copy" box is unticked, the filesystem snapshot can be created.