There's no separate opt-in. Usage-based billing switches on for your whole tenant when any of these happens on or after 1 December: A new Copilot Business subscription. Adding seats to an existing Copilot Business subscription. A Copilot trial converting to paid.

Microsoft 365

Will Microsoft Copilot start charging us extra from December?

From 1 December, new Copilot Business licences bought through a partner come with usage-based billing switched on. Here's what it could cost, what triggers it, and what we're doing about it.

Genmar ITNovember 20267 min read

From 1 December 2026, new Microsoft 365 Copilot Business licences bought through a Microsoft partner (the Cloud Solution Provider, or CSP, programme) come with usage-based billing switched on by default. On top of the fixed monthly cost per seat, your business can now be billed for how much certain Copilot features get used, and nobody has to opt in for that to happen.

The default limit Microsoft sets is 4,000 Copilot Credits per person per month. At Microsoft's list price of $0.01 per credit, that is up to $40 per person, per month, on top of the licence. For a 10-person business, that's up to $400 a month of new spend that nobody explicitly agreed to.

Nothing changes for licences you already have, and the seat price itself isn't going up. But the defaults are set to favour spending, and the trigger is easier to hit than you'd expect.

Does this affect the Copilot licences we already have?

Not on their own. Existing licences stay as they are. Usage-based billing only switches on when something new happens in your tenant on or after 1 December (see “What switches it on?” below).

It only applies to the Copilot Business range, the version for organisations with fewer than 300 users. Microsoft 365 Copilot for enterprise isn't included, and neither are education, non-profit or government community cloud tenants. The licences in scope are:

Microsoft 365 Copilot Business (the standalone add-on)
Microsoft 365 Business Basic + Copilot Business bundles, including the no-Teams and EEA versions
Microsoft 365 Business Standard with Copilot, including the no-Teams and EEA versions
Microsoft 365 Business Premium with Copilot, including the no-Teams and EEA versions

Upgrading an existing licence to one of these doesn't switch usage-based billing on automatically, and neither does moving your licences from one partner to another.

If you buy Copilot Business directly from Microsoft (on its website or in the Microsoft 365 admin centre) rather than through a partner, this already applies. Microsoft switched it on for direct purchases from 19 October 2026.

What does usage-based billing actually charge for?

The everyday Copilot experience in Outlook, Teams, Word, Excel and PowerPoint is still covered by the seat licence. That part hasn't changed.

A growing set of newer, agent-style features is charged differently. Copilot Cowork (which runs multi-step tasks across your files, email and meetings) and the Work IQ APIs are metered in Copilot Credits, and Microsoft says more services will follow. The more they're used, the more they cost.

Microsoft's own guidance gives a rough idea of what a single Cowork task costs:

Typical Copilot Cowork task costs in Copilot Credits
Task size	Example	Copilot Credits	Cost at $0.01 per credit
Light	A weekly status update drafted from your calendar	70–200	$0.70–$2.00
Medium	A briefing pack before a client meeting	400–600	$4–$6
Heavy	Analysing six months of data	1,500+	$15+

Put another way, the default 4,000-credit limit per person runs out after about two or three heavy tasks a month, or somewhere between 20 and 50 light ones.

Microsoft's list price is in US dollars. Partner pricing in the UK is in sterling, so ask your partner for the current sterling rate for your tenant.

Why is Microsoft switching this on by default?

Microsoft's stated reason is friction. Until now, using metered features meant your IT partner had to set up an Azure billing account and a spending policy by hand, so most eligible businesses never did, and their users couldn't try Cowork at all. Microsoft says roughly three in four Copilot Business customers buying through CSP have no Azure footprint today.

The less flattering reason is just as obvious: making paid features available by default means more people use them, and more usage means more revenue. Neither reason is sinister, but it does mean the defaults suit Microsoft better than they suit you.

What switches it on?

There's no separate opt-in. Usage-based billing switches on for your whole tenant when any of these happens on or after 1 December:

A new Copilot Business subscription.
Any new purchase of an in-scope licence, whether placed in Partner Center or through a partner's automated ordering.
Adding seats to an existing Copilot Business subscription.
This is the one that catches people out. You don't need to be a new customer: going from 10 to 12 seats through Partner Center is enough to switch it on for the whole tenant.
A Copilot trial converting to paid.
If a trial rolls into a paid subscription after 1 December, usage-based billing switches on when it converts. That includes the free 25-licence Copilot trial if auto-renewal was left on.

If you don't already have Azure through your partner, an Azure plan, subscription and resource group are created for you in the background. If you do, your partner picks which existing Azure subscription the Copilot usage is billed to. The licence purchase never fails because of this; if the billing setup hits a problem, it retries in the background. If your tenant already has a spending policy, Microsoft won't create a second one.

What is the default spending limit?

The spending policy is what stops usage running away. It sets a monthly cap for the business as a whole and a monthly cap per person. Whichever cap is reached first applies. This is what Microsoft creates by default:

Applies to: All users in the tenant, licensed for Copilot or not
Per-person limit: 4,000 Copilot Credits a month (about $40 at list price)
Tenant limit: 1,200,000 Copilot Credits a month (about $12,000 at list price)
Services: Copilot Cowork and Work IQ APIs, with more added automatically
Billed through: An Azure plan, created automatically if you don't have one
Starts: New qualifying purchases through a partner from 1 December 2026

Two details are easy to miss. First, the policy covers all users, not just the people with a Copilot licence, because Microsoft treats spending policies and seat licences as separate things. Second, the tenant limit is so high that for a small business it will almost never be the cap that applies first. In practice the per-person limit is the one that matters.

Can we turn it off or lower the limit?

Your partner can change the tenant and per-person limits, which services the policy covers, and which Azure subscription usage is billed to, at any time. For something more targeted, such as a policy that only applies to the finance team, the setting is in the Microsoft 365 admin centre under Copilot > Cost management.

Once usage-based billing is set up, it can't be switched off as such. The policy stays in place, and what you control is how much it allows. Microsoft's documentation isn't consistent on how low that can go. One section says you can set the limit to zero; another mentions a platform minimum. Our position is simple: if you don't want metered spend, we set the limit to zero at the point of purchase. If Microsoft's system won't accept zero, we delete the policy. Deleting a policy stops future charges straight away, although any usage already built up is still billed.

One more rule matters if you have more than one policy: where several apply to the same person, the least restrictive one wins. An unlimited policy left over from an earlier pilot will override a tighter one you create later.

How will it show up on our invoice?

Copilot usage is billed separately from your Copilot seats and appears as Azure consumption, next to any other Azure services you already pay for through your partner. Your seat charge stays the same, and the usage is an extra line.

Because adding one seat can switch billing on for the whole tenant, you may see usage charges from staff who had nothing to do with that purchase. That's how Microsoft designed it, not a billing error, but it's better to know before the invoice arrives.

What is Genmar doing about it?

Most of the businesses we supply Copilot Business to started small, often with just one or two seats, and add licences gradually as more staff want them. Under the new rules, each of those small top-ups would switch metered billing on for the whole business.

So here's what we've done and what we're committing to:

Every Copilot trial we've set up has been reviewed. None will convert to paid after 1 December without the client knowing.
We won't add a Copilot seat or place a new Copilot order after 1 December until we've agreed a spending limit with you. That includes a one-seat top-up. Our account managers have been briefed on this.
You choose the limit. We'll explain what each level means in practice, and if you'd rather have no metered spend at all, we'll set it to zero.
We'll check for old spending policies in your tenant, so that a leftover unlimited policy can't override the limit you've agreed.

What should we check before 1 December?

None of this needs urgent action if you aren't planning to buy or add Copilot licences. If you are, settle these first:

Decide what the limit should be.
The default allows about $40 per person per month. For most small businesses a much lower limit, or zero, is the sensible place to start. Agree a number with whoever signs off spending before the next purchase, not after the first invoice.
Check for existing spending policies.
Because the least restrictive policy wins, an old unlimited one will override any sensible limit you add later. Ask your partner, or look under Copilot > Cost management in the Microsoft 365 admin centre.
Know who approves seat changes.
A single extra seat can switch usage-based billing on, so the person who asks for licences should know that, and whoever pays the invoice should expect a separate consumption line.
Tell staff what's metered.
Copilot Chat in Word or Outlook is covered by the licence. Cowork and agent-style tasks use credits. A one-line note to staff avoids surprises for everyone.
Review usage monthly for the first three months.
Partner Center and the admin centre both show current and previous-month consumption against the limit. Three months of data is usually enough to set a limit you won't need to revisit before renewal.

Sources

Microsoft Learn: Usage-based billing for Microsoft 365 Copilot Business in Partner Center
Microsoft Learn: Usage-based billing and cost management for Copilot Credits
Microsoft Learn: Copilot Credits overview (pricing)
Microsoft Copilot Credits Guide, October 2026 (task cost examples)

Microsoft describes parts of this as pre-release and subject to change before general availability. We'll update this article if the details change. Costs are shown at Microsoft's US list price of $0.01 per Copilot Credit; partner pricing in the UK is in sterling.