Update: Usage-based billing will be default-on for new Microsoft 365 Copilot Business licenses starting December 1, 2026
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Update 10/14: This announcement was updated with new assets and resources as of October 14, 2026.
The effective date for this change was updated. 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. Additional updates on availability, Partner Center sandbox environments, default spending limits, and new assets (as of 10/14) are also included.
- Impacted audience
- CSP partners (distributors, indirect resellers, direct bill, SSPs), systems integrators, and software development companies selling Microsoft 365 Copilot Business
Starting December 1, 2026, usage-based billing will be enabled by default for new Microsoft 365 Copilot Business licenses purchased in Cloud Solution Provider (CSP). Pay-as-you-go will be the default billing configuration to help customers access eligible usage-based experiences, including Copilot Cowork, Work IQ APIs, and GitHub Copilot Harness, with less billing setup, while also providing flexibility to expand usage over time based on business needs.
Key details
- Updated effective date: December 1, 2026, previously communicated as November 2, 2026.
- Applies to: New purchases of Microsoft 365 Copilot Business licenses, including standalone offers and bundles, with usage-based billing enabled by default.
- Default spending limit: The default spending limit will be 4,000 Copilot Credits per user per month, which can be adjusted by admins. For example, a customer with 100 M365 Copilot Business users could consume up to 400,000 Copilot Credits per month under the default spending limit, with UBB charges based on actual usage.
- Availability: The change will begin rolling out to eligible customers in supported markets. It will initially not be available in Australia, Belgium, Brazil, France, Germany, India, Italy, Korea, the Netherlands, Poland, and Spain. We'll share additional information as availability expands to these markets.
- Partner Center sandbox environment: To help drive partner technical readiness and testing, Partner Center sandbox environments will be available November 2.
What this means for partners
- Less setup friction: New Copilot Business licenses include the Azure subscription setup needed for usage-based billing.
- More focus on adoption: You can spend more time helping customers activate high-value scenarios and realize business outcomes, with less effort spent on multistep billing configuration.
- Greater growth opportunity: Early usage can create a natural path to expanded consumption, upsell conversations, and the Copilot Cowork activation incentive (PDF).
Next steps
Prepare for the change
- Review the UBB for SMB partner opportunity presentation (PPT) and UBB Default On FAQ.
- NEW (Updated 10/14): Review these new assets including UBB 1-pager, UBB Playbook on a page, and MS Learn article for more information.
- Familiarize your teams with the upcoming change and the preset monthly limit.
- Help your customers understand their usage-based billing options as they adopt eligible experiences.
- Consider usage-based scenarios, including Copilot Cowork, Work IQ APIs, and GitHub Copilot Harness, as part of customer adoption planning.
Resources (Updated 10/14)
- Blog: The two very different bills inside your AI spend
- Blog: Evolution of the Copilot pricing model | Microsoft Community Hub
- MSLearn: Understand usage-based billing and cost management for Copilot Credits
- MS Learn: Managing AI experiences enabled by usage-based billing
- Copilot Credits Guide
- CSP Partner Copilot FAQ