Home 9 Business 9 Microsoft 365 Price Increase 2026 UK: What Your Business Needs to Know

Microsoft 365 Price Increase 2026 UK: What Your Business Needs to Know

Microsoft 365 Price Increase 2026 UK: What Your Business Needs to Know

If your business relies on Microsoft 365 for email, collaboration, or document management, there is an important change coming that will impact your IT budget.

From 1 July 2026, Microsoft is increasing the cost of most commercial Microsoft 365 licences globally. Some plans will rise by as much as 43 percent, making this one of the most significant pricing updates in recent years (Microsoft announcement).

For UK businesses already managing rising costs, this will directly affect monthly and annual IT spend.

The key point is this. You are not locked into absorbing the increase. With the right approach, you can reduce the impact and make sure you are only paying for what your business actually needs.


What Is Changing in Microsoft 365 Pricing?

Microsoft confirmed in December 2025 that pricing changes will take effect from 1 July 2026, applying to both new subscriptions and renewals (official update).

  • Existing customers keep current pricing until renewal
  • New pricing applies at the next renewal after July 2026
  • Changes apply across Business, Enterprise, and Frontline plans

These increases reflect what Microsoft describes as ongoing investment in AI, security, and platform capabilities.


Microsoft 365 Price Increase 2026: Breakdown by Plan

The increase varies depending on your licence. Based on Microsoft published pricing:

  • Microsoft 365 Business Basic → ~16 to 17 percent increase
  • Microsoft 365 Business Standard → ~12 percent increase
  • Microsoft 365 E3 → ~8 percent increase
  • Microsoft 365 E5 → ~5 percent increase
  • Microsoft 365 F1 and F3 (Frontline) → up to 25 to 43 percent increase

These figures come directly from Microsoft pricing tables (full breakdown).

For organisations with frontline staff, this is where the biggest cost increase will be felt.


Why Is Microsoft Increasing Prices?

Microsoft is repositioning Microsoft 365 as a combined productivity, security, and AI platform.

The price increase is tied to:

  • AI integration through Microsoft Copilot
  • Enhanced security with Microsoft Defender
  • Expanded device management through Intune
  • Continuous platform development

Microsoft has stated these updates reflect years of investment and added value across the platform (Microsoft blog).

In simple terms, you are now paying for a much broader platform than just email and Office apps.


Which Microsoft 365 Plans Are Not Increasing?

Two key licences are not increasing:

  • Microsoft 365 Business Premium
  • Office 365 E1

This is important.

Business Standard is increasing by around 12 percent, while Business Premium remains the same price (pricing comparison).

This reduces the gap between the two licences and creates a clear shift in value.

Business Premium includes:

  • Device management through Microsoft Intune
  • Advanced security features
  • Threat protection and compliance tools

For many businesses, upgrading now may deliver better value than staying where you are.


How to Reduce the Impact of the Microsoft 365 Price Increase

There are three key actions you should take now.

1. Review your renewal date

If your subscription renews before July 2026, you may be able to lock in current pricing for another term.

Many organisations are choosing to extend early to avoid the increase (renewal strategy guidance).


2. Audit your licences

Most businesses are over licensed without realising.

Focus on:

  • Removing leavers
  • Downgrading light users
  • Aligning licences to actual job roles

This alone can often offset part of the increase.


3. Reassess your licence strategy

Pricing changes are a natural point to review your setup.

For many organisations:

  • Moving from Business Standard to Business Premium now makes commercial sense
  • Security and device management become included rather than bolt-ons
  • You reduce the need for third-party tools

This is where real long-term savings are often found.


How Bespoke IT Solutions Can Help

Microsoft licensing is not always straightforward. Changes like this make it even more important to get it right.

At Bespoke IT Solutions, we work with businesses across the South East to make sure their Microsoft 365 environment is aligned to how they actually operate.

We help you:

  • Review your current licences and remove wasted spend
  • Align users to the right plans based on usage
  • Improve security without overcomplicating your setup
  • Plan renewals to avoid unnecessary cost increases

This is not just about reducing cost. It is about making sure your Microsoft 365 environment is secure, efficient, and delivering value.


Next Steps: Plan Before July 2026

If your renewal is in the next 6 to 12 months, now is the time to act.

A short review now can help you:

  • Avoid unnecessary spend
  • Improve your security position
  • Make better use of Microsoft 365

If you want a clear view of your options before the pricing changes take effect, Bespoke IT Solutions can help you put a plan in place.

Click here – Get in touch with us

Recent Posts

Cyber Security Threats UK Businesses Face in 2026

Cyber Security Threats UK Businesses Face in 2026

The Cyber Threats UK Businesses Should Be Thinking About Right Now Cyber security has changed. Has your business changed with it? Phishing, stolen accounts, ransomware and vulnerable software aren't new. However, cyber threats continue to change, and some can be...

Automation Before AI: A Smarter Way to Improve Your Business

Automation Before AI: A Smarter Way to Improve Your Business

Automation first. AI second. Before you ask what AI can do, ask what your systems should already be doing AI is exciting, but it isn't always the best place to start. For many businesses, the quickest way to create capacity is simpler. Remove repetitive work, improve...

Switching IT Provider? It’s Easier Than You Think

Switching IT Provider? It’s Easier Than You Think

Thinking of Switching IT Provider? It Doesn’t Have to Be a Headache Changing your IT provider can feel like a big job. But with the right support, it can be much easier than you think. Let’s be honest. Changing your IT provider probably isn’t something you wake up...

AI can save time, but is it saving your business money?

AI can save time, but is it saving your business money?

AI can save time, but is it saving your business money? Most conversations about AI eventually come back to productivity. You see reports created in seconds, emails drafted almost instantly, and repetitive admin handled automatically. It’s easy to assume that saving...

Could AI be the future of Cybersecurity?

Could AI be the future of Cybersecurity?

  Could AI Be the Future of Cybersecurity? Most cybersecurity tools work reactively. Something suspicious happens, the system spots it and security software steps in to limit the damage. That approach is essential and it's protected organisations for years. But...

Cyber Security Is Not Your Job. Understanding Business Risk Is.

Cyber Security Is Not Your Job. Understanding Business Risk Is.

Many business owners switch off the moment cyber security enters the conversation. They picture firewalls, software updates, security alerts and technical jargon. It feels like something that belongs firmly in the hands of IT professionals. The reality is very...

Cyber Confidence Guide and checklist.

Cyber Confidence Guide and checklist.

Welcome to the Cyber Confidence Guide Cyber security is no longer just an IT concern. It is a business priority. Whether your organisation has five employees or five hundred, protecting your systems, data and people is essential to maintaining trust, productivity and...

The 30-Minute IT Health Check Every Small Business Should Do

The 30-Minute IT Health Check Every Small Business Should Do

The 30-Minute IT Health Check Every Small Business Should Do Monthly Most IT problems don't appear out of nowhere. Backups quietly stop running, updates sit unfinished for weeks and old staff accounts stay active long after someone has left the business. A simple...

What Are Passkeys, and Should Your Business Use Them?

What Are Passkeys, and Should Your Business Use Them?

Cybersecurity made simple Passkeys: The Safer, Simpler Way to Sign In Without Passwords Passwords have been causing businesses problems for years. They get reused, forgotten, guessed, leaked, written down, shared, and typed into fake login pages by mistake. Passkeys...