Until now, Microsoft 365 Copilot was a simple bill: a fixed price per person and month. Cowork, Code and the new agents in SharePoint add a second bill. It runs on Copilot Credits and grows with usage. If you set up cost management only after the first agent, you will see the result on the Azure invoice.
What changes
Microsoft splits Copilot into two billing types. The user licence covers everyday work: summarising meetings, drafting documents, analysing data. Copilot Business costs 21 USDP per person and month, with a promotional 18 USD on annual billing. Agentic work that needs more compute or frontier models is billed by usage in Copilot Credits.H
- Billed in credits: Cowork, Code, Autopilot, advanced work in SharePoint and OneDrive, the Work IQ API and the Teams Phone Agent.H
- The licence is still required: Most of these features require a Copilot licence. Credits do not replace it; they come on top.
- No policy, no usage: Before anyone can use these features, an admin has to set up a spending policy.H
The dates
| Date | What happens |
|---|---|
| 16 Oct 2026 | Existing offers sold through resellers (CSP) are now called "(add-on)", for example "Microsoft 365 Copilot Business (add-on)". |
| 1 Dec 2026 | New Copilot Business licences bought through resellers have usage-based billing switched on by default. The default limit is 4,000 creditsH per person and month, and 1.2 million for the tenant. |
| 1 Dec 2026 | New Copilot offers without a Microsoft 365 base subscription arrive at the same price as the current ones. The add-on offers are no longer sold but keep running. |
Three limitations matter. First, the default does not apply at launch in Germany and ten other countries, including France, Italy and the Netherlands. Microsoft has not said when it will come there. Second, it only applies at purchase: existing licences and upgrades do not get it automatically. Third, Microsoft 365 Copilot for enterprise, education and non-profit is excluded.H The date has already moved once, from 2 November to 1 December.
What a credit costs
Microsoft's setup pages do not give a separate credit price for Cowork. They point to the Copilot Credits Licensing Guide and an estimator. The Copilot Studio rates are public: a capacity pack of 25,000 credits costs 200 USD per tenant and monthP, and pre-purchases save up to 20 %.
A calculation, not a price: at the pack rate, one credit costs 0.8 US cents. The default limit of 4,000 credits would then mean up to 32 USD per person and month on top of the licence. For 50 people that is at most 1,600 USD a month. Check in the Licensing Guide whether Cowork credits are billed the same way.
The workflow
- 01StartCheck your licences: add-on or new offer, bought before or from 1 December
- 02PersonGlobal or billing admin opens Copilot, then Cost Management, then Get Started in the admin center
- 03SystemChoose billing: connect an Azure subscription, pre-purchase before pay-as-you-go
- 04SystemSet a monthly tenant limit and a per-person limit, define alert thresholds
- 05CheckShould new services fall under the policy automatically?no: switch off "Auto-apply new services" and approve new services one by one
- 06PersonActivate the policy for a pilot group only
- 07SystemReview usage in the dashboard every month
- 08ResultAdjust limits, expand or set them to zero
Two settings decide the cost. The per-person limit stops one person from using up the whole tenant's monthly budget. Microsoft explicitly recommends setting it. The option "Auto-apply new services" is on by default: every new service Microsoft bills in credits then falls under your policy automatically.H
A limit of zero stops further spending without deleting the policy. Only deleting it ends billing completely.H
Who can do what
- Global and billing admin: set up billing and policies. Microsoft advises using global admin only in emergencies.
- AI and licence admin: edit policies, limits and alerts, but cannot create new policies.
- Reader roles: see usage and reports only. This role suits finance.
Limits and risks
- Moving rules: Dates, countries and services change. Check the Partner Center announcements before every decision.
- Alert emails: Once the threshold is reached, Microsoft sends alerts daily until the month resets. Choose the recipients deliberately.
- Data: Cowork works with company data. Credits do not change the need for correct permissions; see our article on company knowledge.
- Works council: In Germany, usage reports that show individual people's activity count as a technical device under Section 87(1) No. 6 of the Works Constitution Act.
- Where the numbers come from: All figures are from Microsoft. Microsoft does not publish a credit price for Cowork.
Licence prices for the other assistants are compared in our article on the AI tool stack.
How to start
- List all Copilot licences with purchase channel and date.
- Decide who may use Cowork and agents in the pilot, ten people at most.
- Set up the default policy with a tenant limit, a per-person limit and an alert at 80 %.
- Switch off "Auto-apply new services" until you know the new services.
- Review usage after four weeks and decide whether to expand.
Sources
- HMicrosoft Partner Center: October 2026 announcements (updated 14 Oct 2026)
- HMicrosoft Partner Center: Usage-based billing for Copilot Business (as of 12 Oct 2026)
- HMicrosoft Learn: User subscription licence and usage-based billing (as of 6 Oct 2026)
- HMicrosoft Learn: Usage-based billing for Copilot Credits, overview
- HMicrosoft Learn: Set up usage-based billing
- PMicrosoft: Copilot Studio pricing (accessed October 2026)
- PMicrosoft: Microsoft 365 Copilot Business (accessed October 2026)