In this guide · 7 sections
Short answer
From 1 December 2026 (previously announced as 2 November), new Copilot Business licences bought through CSP resellers come with pay-as-you-go billing switched on, with a default limit of 4,000 Copilot Credits per user per month. Only advanced features such as Cowork use credits.
What Microsoft announced, and the new date
Microsoft announced the change to partners in its Partner Center announcements for October 2026, dated 1 October and updated on 14 October. The update says: "Previously communicated as November 2, 2026, usage-based billing will now be enabled by default for new Microsoft 365 Copilot Business subscriptions purchased through CSP, beginning December 1, 2026."
| Item | What Microsoft says |
|---|---|
| Effective date | 1 December 2026 (previously 2 November 2026) |
| Applies to | New Microsoft 365 Copilot Business licences bought through CSP, including standalone offers and bundles |
| Default billing | Pay-as-you-go switched on, with the Azure subscription set up included |
| Default spending limit | 4,000 Copilot Credits per user per month, adjustable by admins |
| Markets | Rolling out to supported markets; not initially in Australia, Belgium, Brazil, France, Germany, India, Italy, Korea, the Netherlands, Poland or Spain |
Singapore is not on the excluded list, so Singapore customers who buy new Copilot Business licences through a reseller from 1 December should expect billing to be on by default. Existing licences are not mentioned as changing.
A separate change from the same month: from 1 December 2026, new Copilot Business offers can be bought without a qualifying Microsoft 365 base subscription. Microsoft says these new offers are priced the same as the current add-on offers.
What usage-based billing covers in Copilot
Microsoft now splits Copilot into two parts. Its pricing page says everyday AI, like chat and Copilot in your Microsoft 365 apps, is included with the licence, while more advanced experiences are billed on usage in Copilot Credits.
Included in the seat price
No meter- Copilot Chat grounded in your work data
- Copilot in Word, Excel, PowerPoint, Outlook and Teams
- Pre-built agents such as Researcher and Analyst
- Fair-use limits apply to the heaviest users
Best for: Everyday drafting, summarising and meeting recaps.
Billed in Copilot Credits
Metered- Copilot Cowork (long-running tasks you hand off)
- Code and Autopilot
- Work IQ APIs for custom apps and agents
- More services may be added over time
Best for: Advanced, longer-running agent work.
Microsoft's overview of Copilot Credits lists the services currently managed under usage-based billing, including Cowork, advanced work in SharePoint and OneDrive, Work IQ API, Copilot Managed Runtime, Teams Phone Agent and Code.
Where admins see and cap the meter
All of this is managed in the Microsoft 365 admin centre under Copilot > Cost Management, according to Microsoft's article on managing usage-based billing. Set it up before staff start trying Cowork, not after the first invoice.
Open Copilot > Cost Management
Sign in to the Microsoft 365 admin centre with an admin role that can manage billing. The Overview tab shows credit use and any policies close to their limit.
Review the default spending policy
Check the per-user limit. Microsoft's partner note gives 4,000 credits per user per month as the default for these licences.
Limit which services can spend
In each policy, pick the agents and services allowed to use credits. Turn off Auto-apply new services if you want to approve new services before they can spend.
Set a monthly policy budget and per-user caps
Choose a limited monthly budget so the policy cannot overspend. Microsoft's guidance currently sets a minimum of 2,000 credits per user per month for a user limit.
Turn on alerts
Set a usage threshold that emails an admin, and turn on user notifications so staff know when they are close to their cap.
Check the Consumption tab monthly
Review use by user, service and policy. Give read-only reporting roles to whoever pays the bills.
Who in a small team should get a Copilot seat
As of October 2026, Microsoft lists Microsoft 365 Copilot Business at US$21 per user per month on an annual plan, with a promotional US$18 for the first year on annual purchases made between 1 July and 31 December 2026. Prices exclude GST. Every Microsoft 365 business user already has free Copilot Chat, so the question is who gains enough from Copilot inside Outlook, Word, Excel and Teams to pay for it.
| Role | Seat? | Why |
|---|---|---|
| Owner or manager drowning in email and meetings | Usually yes | Inbox summaries and Teams meeting recaps save time daily |
| Staff who write proposals, reports or tenders | Often yes | Drafting in Word from your own files |
| Finance or operations working in Excel | Try first | Useful for analysis; test on real spreadsheets |
| Front-desk or field staff who rarely use Office | No | Free Copilot Chat is enough |
Start with three to five seats on monthly billing if you want an easy exit, and review after a month. Our Copilot vs Gemini guide compares Microsoft's options with Google's, and Microsoft 365 licence optimisation shows how to stop paying for seats nobody uses.
What to check before 1 December 2026
Most of the risk is buying licences without knowing billing is on. A short list for owners and whoever manages Microsoft 365:
Before buying new Copilot Business seats
Microsoft's July 2026 price change is covered in our Microsoft 365 price increase guide. Copilot also only shows what each user can already open, so fix oversharing in SharePoint and OneDrive before rolling it out; see Copilot and SharePoint oversharing.
Do it yourself or get help?
Setting spending policies takes an admin about half an hour once the roles are right. The bigger job is making sure admin accounts are protected and that Copilot cannot surface files people should not see.
IT Sorted is a Singapore-based team of developers with over 10 years of experience. Microsoft 365 / Google Security Lockdown (S$590) enforces MFA, cleans up admin roles and tightens sharing settings, which is the groundwork Copilot needs. You buy Copilot licences from Microsoft or your reseller; we earn no commission on them.
Frequently asked questions
Microsoft's Partner Center announcement, updated on 14 October 2026, says usage-based billing will be enabled by default for new Microsoft 365 Copilot Business licences bought through CSP from 1 December 2026. The date was previously announced as 2 November 2026. Some markets are excluded at first, but Singapore is not on that list.
Microsoft's announcement covers new purchases of Copilot Business licences through CSP. Everyday features such as Copilot Chat and Copilot in Word, Excel, Outlook and Teams remain included in the licence. Charges only apply when someone uses metered services such as Cowork, Code, Autopilot or the Work IQ APIs, within the limits admins set.
Microsoft says the default spending limit will be 4,000 Copilot Credits per user per month, and admins can adjust it. For example, Microsoft notes that 100 users could consume up to 400,000 credits a month under the default, with charges based on actual usage. Set a lower monthly policy budget if you want a firm cap.
In the Microsoft 365 admin centre, go to Copilot, then Cost Management. There you can create spending policies for users or groups, choose which services can use credits, set monthly budgets and per-user limits, configure email alerts and review consumption by user, service and policy.
As of October 2026, Microsoft lists Copilot Business at US$21 per user per month on an annual commitment, with a promotional US$18 for the first year on annual purchases made between July and December 2026. Prices exclude GST. Metered services such as Cowork are billed separately in Copilot Credits.