Microsoft will turn on usage-based billing by default for new Copilot Business licenses on December 1

What Microsoft announced

In its October 2026 Partner Center announcements, Microsoft said usage-based billing will be enabled by default for new Microsoft 365 Copilot Business licenses purchased through the Cloud Solution Provider (CSP) program, which is how many small and mid-size businesses buy Microsoft products through a reseller. The notice was first posted October 1 and updated October 14. The start date moved from November 2 to December 1, 2026.

Usage-based billing means a business pays for what its people actually use, measured in units Microsoft calls Copilot Credits, on top of the fixed per-user license. Microsoft says pay-as-you-go will be the default setting so customers can reach eligible usage-based features with less billing setup.

The default spending limit is 4,000 Copilot Credits per user per month. Microsoft gives an example: a company with 100 Copilot Business users could consume up to 400,000 credits a month under that default, with charges based on actual usage. Administrators can adjust the limit.

Which features use credits

Microsoft's documentation lists the services that can be managed through usage-based billing. These include Copilot Cowork, advanced work in SharePoint and OneDrive, the Work IQ API for custom apps and agents, Copilot Managed Runtime, Teams Phone Agent and a coding feature. Several of them require a Copilot license as well.

In the Microsoft 365 admin center, administrators can set spending policies, choose which users and groups may use each service, set organization-level and user-level limits, and turn on alerts as people approach those limits. A separate dashboard shows consumption by user, group, agent and service.

One setting to review: spending policies automatically cover future supported services by default. Microsoft says administrators can turn that off if they want to review new services before they are added.

Who gets it, and when

The change applies to new purchases of Copilot Business through CSP, including standalone offers and bundles. Microsoft says it will roll out to eligible customers in supported markets and will initially not be available in Australia, Belgium, Brazil, France, Germany, India, Italy, Korea, the Netherlands, Poland and Spain. A partner testing environment arrives November 2.

Microsoft also changed how Copilot is sold. In a separate October 14 notice, it said that from December 1 new Microsoft 365 Copilot and Copilot Business offers can be bought without a qualifying Microsoft 365 base subscription, at the same price as the current offers. Current offers are being renamed with "(add-on)" in the name starting October 16, and Microsoft says no action is required for existing subscriptions.

Limits and open questions

The sources reviewed do not state a price per Copilot Credit, so the 4,000-credit limit cannot be turned into a dollar figure here. The official notices are written for partners, and they do not say how the default applies to businesses that buy directly from Microsoft or to existing subscriptions.

The notices also describe a default setting, not a requirement. What a given business ends up paying depends on which features its team uses and the limits its administrator sets.

What this means for your business

If you plan to buy Copilot Business for a team, ask your reseller before December 1 whether your purchase falls under the new default, and what limit will be set. A monthly cap per person is the main protection against a surprise bill, so decide whether 4,000 credits is the right number for each role.

Think about who actually needs the usage-based features. A front-desk employee who only drafts emails may never touch them, while an operations manager building agents might use a lot. Separate spending policies for different groups let you match limits to real work in any industry, from a dental office to a contractor to an accounting firm.

It is also a reminder to price any AI tool by usage, not just by seat. Trnkey AI builds AI automation, agents, websites and dashboards for small and mid-size businesses, and the same question applies there: know what drives cost before you commit.