AI and security
Copilot Business usage based billing: what should you check before 1 December?
From 1 December 2026, new Microsoft 365 Copilot Business licences bought through a Microsoft partner come with usage based billing switched on. Each person can use up to 4,000 Copilot Credits a month on the newer features, which is up to $40 a month on top of the licence. Admins can lower that limit, and for most small businesses they should.
Microsoft is changing how Copilot is billed. Of course they are.
What’s changing with Copilot Business billing?
New Copilot Business licences bought through a Microsoft partner will have usage based billing on by default. Buying through a partner means the Cloud Solution Provider programme, which is how most small businesses buy Microsoft 365. It covers standalone Copilot Business licences and the bundles that include it.
Microsoft’s Partner Center announcement first gave the date as 2 November 2026, then moved it to 1 December.
The default spending limit is 4,000 Copilot Credits per user, per month. It isn’t set to zero. Microsoft’s own example: a business with 100 users could use up to 400,000 credits a month, and is charged for what’s actually used.
Which Copilot features use Copilot Credits?
The newer, heavier ones. Microsoft’s list for Microsoft 365 Copilot is:
- Cowork
- advanced work in SharePoint and in OneDrive
- the Work IQ API, for custom apps and agents
- Copilot Managed Runtime
- Teams Phone Agent
Copilot in Word, Excel, Outlook and Teams isn’t on that list.
How much could usage based billing cost?
Microsoft lists Copilot Credits at $0.01 each on pay as you go, priced in US dollars and subject to change. At the default limit, that’s up to $40 per user per month on top of the licence, if someone uses all 4,000 credits.
Most people won’t get near that. The point is that the default lets them, and nobody has to ask first.
Does it apply to UK businesses?
Yes. Microsoft has listed the countries where it won’t be available at first: Australia, Belgium, Brazil, France, Germany, India, Italy, Korea, the Netherlands, Poland and Spain. The UK isn’t on that list.
Does it affect the Copilot licences we already have?
The announcement covers new purchases from 1 December and says nothing about renewals. If you already have Copilot Business, ask your IT provider to check what applies at your next renewal rather than assuming.
What should we set the limit to?
Start low and raise it when there’s a reason. Admins can set limits for the whole organisation and for individual people, and control who can use credits at all through spending policies. If someone needs more, there’s a request process an admin approves.
Two settings matter most:
- Who can use credits. For most small businesses, that’s the handful of people actually trying the advanced features, not everyone with a licence.
- Auto apply new services. This is on by default. Any new credit based service Microsoft releases gets added to your spending policy automatically. Turn it off and new services wait until someone has looked at them.
If you’ve never set a usage limit before, start at the amount you’d be happy to see on an invoice without asking any questions. Then look at the usage after a month.
What should we ask our IT provider before 1 December?
- What’s our credit limit set to, per user?
- Who can use credits at all, and who decided?
- Who gets the alert when someone gets close to the limit?
- Is auto apply new services switched on?
- Which of our people actually need the advanced features?
Admins can set alerts for themselves and threshold notifications for users, and can see who’s getting close to their limit. Make sure the alerts go to a person who reads them rather than a shared mailbox nobody checks.
How does Saturday Cloud set up Copilot?
I sell Copilot, and I still don’t think most small businesses should buy a seat for everyone. We start with a few people, check what Copilot can see before switching anything on, and review at 90 days. With usage based billing, we also set the credit limit low, choose who can use credits, turn off auto apply, and point the alerts at someone real.
If you’re buying Copilot Business before or after 1 December and want a second opinion, get in touch.
Questions
The questions people ask us about this
Does Copilot in Word, Excel and Outlook use Copilot Credits?
Not according to Microsoft’s list. The services that draw on credits are the newer ones: Cowork, advanced work in SharePoint and OneDrive, the Work IQ API, Copilot Managed Runtime and Teams Phone Agent.
Who sets the Copilot Credits limit?
Your Microsoft 365 admins, which usually means your IT provider. Limits can be set for the whole organisation and for individual people, and someone who needs more can send a request for an admin to approve.
Is $40 a user a month the most it can cost?
At the default limit, yes. 4,000 credits at $0.01 each is $40 per user per month, priced in US dollars and subject to change. An admin can raise the limit, which raises the ceiling, or lower it, which is what we recommend.