Microsoft 365 Price Increases Take Effect From 1 July 2026
Microsoft Announces New Microsoft 365 Commercial Pricing
Businesses using Microsoft 365 should be aware that Microsoft’s latest commercial pricing changes take effect from 1 July 2026. The update affects a range of Microsoft 365, Office 365, Business, Enterprise, Frontline and standalone security products, with price increases applying to new customers immediately and to existing customers at their next renewal date after 1 July 2026.
According to Microsoft, the changes reflect continued investment in Microsoft 365 services, including AI-powered capabilities, enhanced security features, compliance tools and IT management functionality delivered over recent years.
Key Price Changes
Several popular Microsoft 365 plans are increasing in price:
– Microsoft 365 Business Basic: per user/month (+16%)
– Microsoft 365 Business Standard: per user/month (+12%)
– Microsoft 365 E3: per user/month (+8%)
– Microsoft 365 E5: per user/month (+5%)
– Office 365 E3: per user/month (+13%)
– Microsoft 365 F1: per user/month (+33%)
– Microsoft 365 F3: per user/month (+25%)
Microsoft has confirmed that standalone Microsoft Teams and Microsoft 365 Copilot subscriptions are not included in this specific pricing update.
What This Means For Organisations
For many organisations, the impact will first be seen at their next Microsoft renewal after 1 July 2026. Businesses with large numbers of licensed users should review their current subscriptions, identify unused licences and ensure they are on the most appropriate Microsoft plan for their requirements.
The increase follows Microsoft’s wider strategy of adding AI, security and management capabilities into Microsoft 365. Recent enhancements include expanded Copilot experiences, additional security features and improved administration tools designed to support modern hybrid working environments.
Our Recommendation
Organisations should:
– Review current Microsoft 365 licensing.
– Assess licence utilisation across users.
– Budget for renewal increases.
– Consider whether alternative Microsoft plans deliver better value.
A proactive review can help minimise unnecessary costs while ensuring users continue to receive the productivity, collaboration and security features they need.
Need Advice?
If you would like assistance understanding how the July 2026 Microsoft 365 price changes may affect your organisation, contact our team for a Microsoft 365 licensing review and cost optimisation assessment