If you run Microsoft 365, your costs are going up on 1 July 2026. Microsoft has confirmed the increase, it applies worldwide, and it is the first broad rise in the commercial plans since 2022. The good news is that there is a legitimate way to hold your current rate for the next term, and the window to use it is open right now.
Here is the plain version of what is changing and what to do about it.
What is changing
From 1 July 2026, the list price of most Microsoft 365 business and enterprise plans goes up. These are the headline prices, per user per month, in US dollars, with the increase on each.
| Plan | Was | From 1 July | Change |
|---|---|---|---|
| Microsoft 365 Business Basic | $6.00 | $7.00 | +17% |
| Microsoft 365 Business Standard | $12.50 | $14.00 | +12% |
| Microsoft 365 Business Premium | $22.00 | $22.00 | no change |
| Microsoft 365 E3 | $36.00 | $39.00 | +8% |
| Microsoft 365 E5 | $57.00 | $60.00 | +5% |
| Office 365 E3 | $23.00 | $26.00 | +13% |
| Office 365 E5 | $38.00 | $41.00 | +8% |
| Microsoft 365 F1 | $2.25 | $3.00 | +33% |
| Microsoft 365 F3 | $8.00 | $10.00 | +25% |
Two useful details hide in that table. Business Premium does not change, so if you are on Premium your per user price holds. And the frontline plans, F1 and F3, rise the most in percentage terms, which matters if you have a large shift based or deskless workforce.
A note on Rand pricing. Those figures are the global US dollar list. Microsoft sets South African Rand pricing locally and it moves with the exchange rate, so the post increase Rand figure is not simply today’s price plus the percentage. As a rough guide, current Rand pricing sits near R110 a month for Business Basic, R219 for Business Standard and R400 for Business Premium, before VAT. For your exact Rand numbers, get a current quote. We are happy to run one for you.
Does Microsoft 365 Copilot change?
No. The Copilot add-on price is not part of this increase. The enterprise add-on stays at about thirty US dollars per user a month. For smaller teams, Copilot Business is on a limited time discount of about eighteen US dollars per user a month until 30 June 2026, after which it returns to twenty one. So if Copilot is on your roadmap, that same 30 June date is worth a note.
The one move that protects your rate
This is the part worth acting on. Microsoft has confirmed that if you renew or buy before 1 July, you keep your current pricing for the term. In Microsoft’s own words:
“For customers with renewals before July 1, 2026, they will be able to renew or upgrade to their chosen suite and lock in the current pricing (pre-price increase pricing) until their next renewal after July 1, 2026.”
It applies to both annual and monthly billing. Renew before the deadline and the increase only reaches you at your next renewal after it. For most businesses that is a full term at today’s rate, protected.
How the lock works, by the way you buy
Not every agreement behaves the same way, so this is where a little detail saves real money.
- If you buy through a partner on an annual commitment, which is the most common setup for South African businesses, renewing or committing before 1 July holds your price for that term. A twelve month commitment locks the rate for a year. A thirty six month commitment locks it for three.
- If you are on month to month billing, you are exposed soonest, because a monthly subscription effectively renews every month and moves to the new price from the first renewal on or after 1 July. Month to month also carries a premium over annual billing, so it is the most expensive way to buy and the hardest to protect.
- If you are a larger organisation on an Enterprise Agreement, the same principle applies at your renewal. Be aware that very large enterprises also absorbed a separate change late in 2025, when Microsoft removed some volume discounts. That is why you may have seen headlines quoting increases closer to twenty percent. That combined figure is an enterprise story. For a typical small or mid sized business, the real number is the single digit to seventeen percent list rise in the table above.
A worked example
Take a team of twenty five people on Business Standard. At today’s price the licences cost about 3,750 US dollars a year. From 1 July, the same licences cost about 4,200, an increase of roughly 450 dollars a year. Lock in before the deadline on a three year commitment and you protect close to 1,350 dollars over the term, for one decision made on time.
The numbers are not enormous for a small team. They are not trivial either, and they scale with every seat you add.
What to do now
- Find your renewal dates. Anything that renews on or after 1 July 2026 is exposed to the new price.
- Confirm how many users sit on each plan, and whether anyone should move up or down a tier before you renew. Not sure what you should be on? See Braintree’s Microsoft licensing page for a clear view of what each plan covers.
- Renew eligible annual terms before the deadline, and give yourself a buffer rather than leaving it to the last day, so the order is processed in time.
- Decide on term. A longer commitment holds the rate longer, at the cost of some flexibility to reduce seats later.
- Settle any Copilot or promotional decisions before 30 June, since several offers are reported to close with the price change.
Why Microsoft is doing it
For context, this is the first broad increase to these plans since 2022. Microsoft points to the value added since then, including the Copilot Chat experience now built into the suites, added security such as Microsoft Defender for Office 365, and management tooling. Whether or not you use every new feature, the increase applies, so the task is to manage the cost rather than debate it.
We can do the work for you
You do not have to model this yourself. We can pull your current licensing, show you the cost before and after the increase in your actual currency, and handle the renewal so the rate is locked in time.
Braintree manages Microsoft licensing for businesses across South Africa under a single Microsoft Customer Agreement: every licence, every workload, one renewal date. If you are not sure what you are on or what you should move to, that is the conversation to start now. See how Braintree handles Microsoft licensing.
The increase is fixed. Whether it costs you more depends on what you do before 1 July. Here are the two paths:
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