For a small business, Microsoft 365 Copilot costs $21 a user a month on an annual commitment, or $25.20 a month if billed monthly, through the Copilot Business licence for organisations of up to 300 users. A promotional $18 applies to annual purchases until 31 December 2026. Larger organisations on enterprise plans pay $30 a user a month on top of their base licence.
That headline price is rarely what you end up paying, though. Copilot is an add-on, so it sits on top of a Microsoft 365 plan whose prices rose in July 2026. Microsoft also sells bundles that include Copilot, and for many small businesses the bundle is cheaper than buying the add-on separately. The right answer depends on how many people get Copilot and which base plan they're on.
Every Copilot price in one table
List prices in USD per user per month, as shown on Microsoft's pages in September 2026. Monthly billing on business plans costs about 20% more than annual billing, and it's still a one-year commitment.
| Licence | Annual billing | Monthly billing | Who it's for |
|---|---|---|---|
| Copilot Chat | Included | Included | Anyone with an eligible Microsoft 365 plan |
| Microsoft 365 Copilot Business (add-on) | $21 (promotional $18 from 1 Jul to 31 Dec 2026) | $25.20 | Business Basic, Standard or Premium tenants, up to 300 users |
| Business Standard with Copilot (bundle, with Teams) | $23.50 | $28.20 | Replaces Business Standard for those users |
| Business Premium with Copilot (bundle, with Teams) | $32 | $38.40 | Replaces Business Premium for those users |
| Business Standard with Copilot (without Teams) | $20.30 | About 20% more | For businesses that don't use Teams |
| Business Premium with Copilot (without Teams) | $28.80 | About 20% more | For businesses that don't use Teams |
| Microsoft 365 Copilot (enterprise) | $30, on top of the base licence | Check with Microsoft | E3, E5, Apps for enterprise, Office 365 E1/E3 and similar |
| Microsoft 365 E7 (E5 + Copilot + Agent 365 + Entra Suite) | $99 | Check with Microsoft | Large organisations wanting everything in one licence |
| Copilot Studio capacity pack | $200 a month per 25,000 Copilot Credits, per tenant | Or a pay-as-you-go meter | Custom agents, especially for staff without Copilot licences |
The rows most small businesses need are the second, third and fourth. Everything below them matters only if you have more than 300 users or you're building your own agents.
Business licence or Enterprise licence: which can you buy?
You don't really choose between them; your base plan chooses for you.
- Copilot Business is for organisations with 300 or fewer users on Microsoft 365 Business Basic, Business Standard or Business Premium. Microsoft's FAQ caps it at 300 seats per tenant.
- Microsoft 365 Copilot (enterprise) is for tenants on enterprise plans such as Microsoft 365 E3 or E5, Microsoft 365 Apps for enterprise, or Office 365 E1 and E3. If you have Apps for enterprise, for instance, you can buy the enterprise Copilot licence but not Copilot Business.
Microsoft says Copilot Business delivers the same capabilities as the enterprise Copilot offering: Copilot in Word, Excel, PowerPoint, Outlook and Teams, chat grounded in your organisation's data, the built-in Researcher, Analyst and Facilitator agents, Pages, Notebooks and access to Copilot Studio. The differences people notice come from the base plan underneath. Enterprise plans carry more compliance, security and analytics features; Copilot on top of them is the same product.
Two commitment rules catch people out, both from Microsoft's FAQ. If you already bought the enterprise Copilot add-on, you can't switch those licences to Copilot Business until the annual commitment ends; they don't convert automatically at renewal. And if you're on Business Standard or Premium with Copilot Business, you can't upgrade to an enterprise plan until your commitment end date.
The base plan you pay for underneath
Copilot's price is only half the bill. Microsoft 365's own prices changed on 1 July 2026, taking effect for existing customers at their next renewal:
| Base plan | Before July 2026 | From July 2026 (annual) |
|---|---|---|
| Business Basic | $6 | $7 |
| Business Standard | $12.50 | $14 |
| Business Premium | $22 | $22 (unchanged) |
| Microsoft 365 E3 | $36 | $39 |
| Microsoft 365 E5 | $57 | $60 |
| Office 365 E3 | $23 | $26 |
So a Business Standard user with the Copilot add-on at full price costs $14 plus $21, which is $35 a month. An E3 user with enterprise Copilot costs $39 plus $30, which is $69.
Add-on or bundle: the sum that decides it
Here is the part most price pages skip. Business Standard with Copilot costs $23.50 a user on annual billing. Business Standard plus the Copilot add-on bought separately costs $35. For each person who gets Copilot, the bundle is $11.50 a month cheaper. On Business Premium the gap is similar: $32 bundled against $43 separately.
It gets more striking for Business Basic users. Basic plus the add-on is $7 plus $21, which is $28. Business Standard with Copilot is $23.50, which is cheaper and adds the desktop Office apps that Basic doesn't include.
Take an illustrative 12-person home-care provider on Business Standard. Four office staff would use Copilot; eight carers mainly use email on their phones.
| Route | Calculation | Monthly cost | Yearly cost |
|---|---|---|---|
| Add-on for 4 users (full price) | 12 x $14 + 4 x $21 | $252 | $3,024 |
| Add-on for 4 users (promotional $18) | 12 x $14 + 4 x $18 | $240 | $2,880 |
| Bundle for the 4, plain Standard for 8 | 4 x $23.50 + 8 x $14 | $206 | $2,472 |
| Bundle for all 12 | 12 x $23.50 | $282 | $3,384 |
Moving just the four Copilot users onto the bundle is the cheapest route by about $550 a year against the full-price add-on. Microsoft 365 tenants commonly mix plan types by user, but check two things with Microsoft or your partner before planning around it: whether you can move those users onto the bundle before your current Business Standard commitment ends, and whether the bundle price is fixed for your term or introductory.
Buying the bundle for all 12 costs the most here, because eight carers would get Copilot they don't need. The bundle-for-everyone route only wins when nearly everyone would use it.
Three budgets, from two users to more than 300
Cheap: an independent bookshop with two office users
Say an independent bookshop has five staff on Business Basic, and only the owner and the events manager would use Copilot. Adding Copilot Business to Basic for two people costs 2 x $21 = $42 on top of the existing $35 for five Basic licences, $77 a month in all. Moving the two onto Business Standard with Copilot instead: 2 x $23.50 + 3 x $7 = $68 a month, which is cheaper, and the two get desktop Word and Excel. Yearly: about $816 against $924.
Mid: the 12-person home-care provider
As above: $206 to $252 a month depending on route, or roughly $2,500 to $3,000 a year for four Copilot users. Add some internal time for tidying SharePoint permissions (see below) and a month's trial before committing.
High: a 320-person care group
Picture a care group that has grown past 300 users. It can't use Copilot Business, so it moves to an enterprise base plan. On Microsoft 365 E3 at $39, enterprise Copilot at $30 for the 60 office and management staff who'd use it adds $1,800 a month, on top of $12,480 a month for 320 E3 licences. The alternative, Microsoft 365 E7 at $99 for everyone, only makes sense if it also needs E5-level security and wants Agent 365; for most of the frontline staff it would be paying for far more than they use.
What Copilot really costs per user in year one
A licence price is easy to compare, but the number worth budgeting is the full first-year cost per person who uses Copilot. Here it is for the home-care provider's cheapest route, with illustrative internal costs:
| Item | Calculation | Year one |
|---|---|---|
| Extra licence cost of the bundle over plain Business Standard | 4 users x $9.50 x 12 months | $456 |
| Permissions review before switching on | 8 hours of the office manager's time at $30 | $240 |
| Getting people started | 4 users x 2 hours at $28 | $224 |
| Monthly usage check and seat review | 15 minutes a month at $30 | $90 |
| Total | $1,010 | |
| Per Copilot user | $1,010 / 4 | about $253 a year, or $21 a month |
Two things fall out of that. First, internal time roughly doubles the licence cost in year one, then mostly disappears in year two. Second, the all-in figure per user is about what the add-on alone would have cost. That's the bundle saving paying for the setup work.
When a small business ends up on enterprise pricing anyway
Being under 300 users doesn't lock you into business plans. Some small organisations already run Microsoft 365 E3 or E5, perhaps because a parent company, a funder or an IT provider set them up that way, or because they needed security and compliance features beyond Business Premium. For them, Copilot is the enterprise licence at $30 a user, not $21.
If that's you, check whether you still need the enterprise base plan. An illustrative 25-person care service on E3 pays $39 plus $30, or $69 a month, for each Copilot user. On Business Premium with Copilot it would pay $32, and Business Premium includes a good set of security tools for organisations of that size. Moving plans is a bigger decision than Copilot alone, with security and compliance implications, so treat it as a question for your IT provider at renewal, not a mid-year switch.
A realistic budgeting mistake
An illustrative florist with ten staff reads that Copilot is "$25.20 a month, billed monthly" and assumes that means month-to-month. In January it buys ten licences on monthly billing, planning to cancel any that don't get used. By April, four shop-floor staff have never opened it. Because Copilot Business is an annual commitment even when billed monthly, the florist is paying for those four licences until the following January: four users at $25.20 for nine more months, about $907 for nothing. Reassigning them doesn't help, because nobody else wants one. A one-month trial for three people, followed by three licences on annual billing, would have cost a fraction of that.
Costs that don't appear on the price page
- The annual commitment. Copilot Business has no month-to-month option. A licence bought for someone who stops using it in month three still costs nine more months. You can reassign it to another person, though.
- The end of the promotion. If you budget at $18, find out when your price moves to $21. Across four users, that's $144 a year.
- Permissions clean-up. Copilot surfaces anything a user can already open. Reviewing SharePoint and OneDrive sharing before rollout takes a small business anywhere from an afternoon to a few days of internal or partner time. Our tutorial on hiring a Microsoft 365 partner for a Copilot rollout covers what to ask a partner to do and what to do yourself.
- Agents for unlicensed staff. If you build an agent in Copilot Studio and let staff without Copilot licences use it, that usage is metered. For a small business, the pay-as-you-go meter is usually safer than a $200 monthly capacity pack. See what Copilot Studio is and whether a small business needs it.
- Things you no longer need. Teams intelligent recap needs Teams Premium or a Copilot licence. If you pay for Teams Premium mainly for recaps, the Copilot users may not need it any more.
- Monthly billing uplift. Choosing monthly billing on a business plan costs about 20% more for the same one-year commitment. It helps cash flow, not flexibility.
Five ways to pay less
- License people, not the company. Start with the three or four who spend most of their day in Outlook, Teams and Office. Everyone else keeps free Copilot Chat. Use the tests in is Microsoft 365 Copilot worth it for a small business? to pick them.
- Price the bundle before the add-on. For Business Standard and Basic users, the bundle is usually cheaper per Copilot user.
- Use the free trial. Microsoft offers a one-month trial that converts to a paid subscription automatically. Diary the end date.
- Measure before renewal. Unused licences are the biggest waste. The admin centre's Copilot usage report shows who's active; measuring whether Copilot is paying for itself sets out a fuller method.
- Time the commitment. Because the commitment runs a year, align Copilot purchases with your Microsoft 365 renewal date where you can, so you review both together.
A sample request to send your Microsoft partner
If you buy through a partner rather than directly, a short written request gets clearer answers than a phone call. Here's an illustrative version, filled in for the home-care provider:
Subject: Copilot pricing options - 12 users, renewal 1 March
We have 12 users on Microsoft 365 Business Standard,
annual commitment renewing 1 March. We want Copilot for 4
office staff only. Please quote:
1. Copilot Business add-on for 4 users, annual commitment:
price now, and price after 31 December 2026.
2. Moving those 4 users to Business Standard with Copilot:
can this happen before 1 March, and is the $23.50 price
fixed for the full term?
3. Whether a one-month trial can run before we commit.
4. Any partner fees for licensing, setup or a permissions
review, itemised.
Please confirm all prices in writing, per user per month,
annual billing and monthly billing.An illustrative reply worth accepting would answer all four points with figures and dates. If the reply only quotes the add-on at full price and doesn't mention bundles, ask again; it's the most common gap in quotes. And compare the figures with Microsoft's own business pricing page, since partners can price differently.
For what the licence does compared with the free version, read Copilot Chat vs Microsoft 365 Copilot. And if you're weighing the commitment itself, annual or monthly billing for AI tools covers the trade-off across vendors.
Copilot pricing questions small businesses ask
Is there a minimum number of Copilot Business licences?
Microsoft's Copilot Business FAQ sets a maximum of 300 seats per tenant and doesn't list a minimum, so a small business can license a single user. The licence is an add-on, so each person also needs an eligible Microsoft 365 Business Basic, Standard or Premium licence underneath it.
Does the $18 promotional price last for my whole contract?
Microsoft describes $18 as promotional pricing for purchases on annual commitment between 1 July and 31 December 2026, against a regular $21. Whether you keep $18 until your renewal date or move to $21 sooner depends on your agreement, so confirm it in writing with Microsoft or your partner before relying on it in a budget.
Can I buy Copilot Business with Microsoft 365 E3?
No. Copilot Business is only for tenants on Microsoft 365 Business Basic, Standard or Premium. Enterprise plans such as E3, E5 and Microsoft 365 Apps for enterprise use the enterprise Microsoft 365 Copilot licence at $30 a user a month on annual commitment, which has the same core Copilot capabilities.
Do staff without a Copilot licence get anything?
Yes. Copilot Chat is included with Microsoft 365 business and enterprise subscriptions at no extra cost. It gives web-grounded chat with work data protection and help with the email or file a person has open. Agents used by unlicensed staff are billed on a metered, pay-as-you-go basis.
Further reads
- Microsoft 365 Copilot Readiness Checklist for Small Businesses — Get the tenant ready before paying for licences.
- Google Workspace vs Microsoft 365 for AI: Which Suits Your Business? — How Google's built-in Gemini pricing compares.
- Your Software Raised Its Price for AI: Keep, Downgrade or Switch? — What to do when a price rise arrives with AI attached.
- How to Read AI Software Pricing: Seats, Credits, and Usage Fees — Decode seats, credits and usage fees on any price page.
- How to Negotiate AI Software Prices and Seat Numbers — Negotiate seat numbers and terms at renewal.
- How to Roll Out Microsoft 365 Copilot to a Small Team — The first month after you buy.
- How Much Does AI Cost a Small Accounting Firm? — An itemised AI budget for three-, eight- and fifteen-person accounting firms: list prices, per-client costs, internal time and the hidden extras.
- What Does AI Cost a Small Insurance Brokerage in Year One? — Year-one AI costs for four, eight and twelve-person brokerages, quarter by quarter, including the staff time and compliance work most budgets leave out.
- How to Answer Staff HR Questions With an AI Helpdesk — Build an internal AI helpdesk that answers everyday HR questions from your own policies and hands personal or sensitive matters to a named person.
- AI Subscription Prices Compared for Small Businesses (2026) — Every major AI subscription a small business is likely to pay for, priced side by side, with three example stacks and the costs pricing pages leave out.
- ChatGPT or Copilot for a Microsoft 365 Business? — Decide whether a Microsoft 365 team needs paid Copilot, ChatGPT or included chat, using a two-user cost and workflow trial.
- How to Clean Up SharePoint Permissions Before Turning On Copilot — Copilot surfaces whatever each person can already open. A driving school's cleanup shows the reports, settings and tests that close the gaps first.
- Copilot in Teams Meetings: Recaps, Actions and Privacy Settings — Licences, meeting options and admin policies for Copilot in Teams, plus prompts, a task clean-up routine and the privacy settings to decide first.
- Copilot in Excel: What It Can and Can't Do With Your Numbers — The Copilot pane's three modes tested on a pet shop's sales file, the margin formula it got wrong, and what to do with old COPILOT() cells.
- Copilot in Word: Draft Proposals From Your Own Files — A care-home cleaning proposal drafted from five sources, the old client name it leaked, and what Copilot in Word can read with and without the licence.
- Does Microsoft 365 Copilot Keep Your Business Data Private? — What Microsoft 365 Copilot does with your prompts and files, where web searches go, and the permission clean-up that keeps staff from seeing too much.
- AI Tools and AI Development: The Complete 2026 Guide — the AI hub, including every tutorial in the AI-for-business series.
Sources: Microsoft 365 Copilot for business product page (add-on, bundles with and without Teams, promotion, 300-user limit, one-month trial); Microsoft Copilot enterprise pricing page; Microsoft Learn Copilot Business FAQ; Microsoft licensing news on July 2026 Microsoft 365 price changes; Microsoft's announcement of Microsoft 365 E7; Microsoft Learn and Copilot Studio pricing pages; checked September 2026.