In short
From 1 December 2026, new Microsoft 365 Copilot Business licences bought through a CSP partner come with usage-based billing switched on by default, and Ireland is in scope. Microsoft says Copilot in your everyday apps stays inside the licence fee. Newer agent features are charged per use, up to a default of 4,000 Copilot Credits per user per month. Ask your IT provider to set a spending limit before you buy.
If you're planning to add Microsoft 365 Copilot for your team, the bill you sign up for in December may not be the bill you see in January. From 1 December 2026, Microsoft switches on usage-based billing by default for new Copilot Business licences bought through a partner. Nobody has to tick a box for it to apply.
Here's what changes, what doesn't, and the questions to put to your IT provider before you buy.
What changes on 1 December, and what stays the same
Microsoft announced in its October 2026 partner update that usage-based billing will be on by default for new Microsoft 365 Copilot Business licences bought through Cloud Solution Provider (CSP) partners. That includes bundles that contain Copilot. A CSP partner is the IT company that resells and manages your Microsoft licences, which for most Irish small businesses means their IT provider.
The change was due on 2 November and Microsoft pushed it back a month.
Ireland is in scope. Microsoft has named a small number of countries where the change won't apply at first, and Ireland isn't one of them.
What stays the same is the monthly per-user licence fee. Usage billing sits on top of it, for specific features only.
What counts as usage, and what your licence already covers
Microsoft's announcement names the first features billed per use: Copilot Cowork, Work IQ APIs and GitHub Copilot Harness, with more to follow. Microsoft's Copilot pricing page also lists Code and Autopilot. These are the agent-style features, where Copilot carries out multi-step work on someone's behalf instead of answering a single prompt.
According to the same pricing page, Copilot Chat and Copilot inside Word, Excel and Outlook stay inside the licence fee. For most small firms, that's where the day-to-day use is: drafting emails, summarising meetings, tidying up spreadsheets.
Microsoft changes what sits in each plan every few months. Treat this list as correct on the day it was written, and check the current position with your provider before you set a budget.
The 4,000-credit default: a ceiling, not a bill
Usage is measured in Copilot Credits. By default, each user can spend up to 4,000 credits a month on the billed features. Your administrator, or your IT provider, can raise or lower that limit.
A user who never touches the agent features costs nothing extra. But a default of 4,000 credits across 20 staff is 80,000 credits a month of possible spend that nobody chose on purpose.
Microsoft's announcement doesn't give a euro price per credit, so I'm not going to guess one here. Ask your provider for the current rate before you commit.
Two more points matter for your budget:
- There's no single off switch. Once usage billing is set up, spend is controlled through the limit, according to Microsoft's partner guidance.
- The charges arrive through your provider. Usage is billed to the CSP partner, so it will show up on your monthly IT invoice, not on a separate bill from Microsoft.
Who this affects: new licences, extra seats and the grey areas
The clear case is a new Copilot Business licence, or a bundle containing one, bought through a partner on or after 1 December.
The grey areas are adding seats to an existing subscription and moving from one plan to another. Published sources disagree on whether either one switches usage billing on. CRN reports that both do. Microsoft's own partner guidance says upgrades are out of scope, and that added seats depend on how the partner places the order.
If you're planning either, ask your provider which applies to your order before they place it.
A second date in the same month
The discounted annual price for Copilot Business runs until 31 December 2026, and it covers the first year only, according to Microsoft's pricing page. So if you're weighing up Copilot, you have two dates four weeks apart: the billing default on 1 December and the end of the promotional price on 31 December.
Five decisions to make before you buy or add Copilot seats
- Who needs Copilot at all. Licence the people who will use it every day. A licence for everyone is rarely the right starting point for a 15- or 30-person firm.
- Whether anyone needs the agent features yet. If the answer is no, ask for the usage limit to be set as low as Microsoft allows.
- What limit to set for the people who do. Pick a monthly figure you'd be comfortable seeing on an invoice, and set the credit limit to match it.
- Who watches the spend. Agree who checks usage each month and who can approve a higher limit. In a small firm, that's usually the owner or the office manager.
- Annual or monthly, and when. Weigh the discounted annual price against committing for a year to a product your team hasn't tried yet.
What to do next
If you're planning a Copilot purchase before Christmas, talk to your IT provider before 1 December rather than after. Ask them three things:
- Will usage billing apply to this order?
- What limit will you set, and can we agree it in writing?
- How will we see usage each month?
If we look after your Microsoft 365, this falls under our managed IT service and we'll go through it with you. If you want a wider view of where AI fits in your business, that's the kind of question our Technology Success Program quarterly reviews are for. Or get in touch and we'll talk it through.
Will I be charged extra for Copilot automatically from 1 December?
Not automatically. From 1 December 2026, usage-based billing is switched on by default for new Copilot Business licences bought through a partner, but charges only arise when someone uses the per-use features, such as Copilot Cowork. Each user has a default limit of 4,000 Copilot Credits a month, which your IT provider can lower.
Does usage-based billing affect Copilot licences I already have?
Microsoft's change applies to new Copilot Business licences, including bundles, bought through a CSP partner on or after 1 December 2026. Published sources disagree on whether adding seats or upgrading an existing plan switches it on, so ask your IT provider how your specific order will be placed before you add licences.
Can I turn off Copilot usage-based billing?
There isn't a single off switch once usage billing is set up. Spend is controlled through a per-user monthly credit limit, which your administrator or IT provider sets. If your team doesn't need the agent features yet, ask your provider to set the limit as low as Microsoft allows and to confirm it in writing.
What is a Copilot Credit?
A Copilot Credit is the unit Microsoft uses to measure the Copilot features that are billed per use, mainly agent features that carry out multi-step tasks. The default limit is 4,000 credits per user per month. Microsoft's announcement doesn't state a euro price per credit, so ask your IT provider for the current rate.
Are Copilot Chat and Copilot in Word still included in the licence?
According to Microsoft's Copilot pricing page at the time of writing, Copilot Chat and Copilot inside Word, Excel and Outlook stay covered by the licence fee rather than billed per use. Microsoft changes what each plan includes regularly, so confirm the current position with your provider before you set a budget.