Microsoft 365 Prices Go Up in July 2026 — What Perth Businesses Need to Do Before Then

Microsoft has confirmed that commercial pricing for Microsoft 365 will increase on 1 July 2026. If you run a business on Microsoft 365, and most IT-dependent Perth businesses do, you have roughly four months to review your licences, lock in renewals, and make sure you are actually using what you are paying for.

The good news is that Microsoft is not just raising prices. They are bundling in security, AI, and device management features that previously cost extra. The bad news is that if you do not act before your next renewal, you will pay more without necessarily getting more value. Here is what is changing and what you should do about it.

What is changing with Microsoft 365 pricing

Microsoft announced these changes in December 2025, giving businesses roughly seven months to prepare. The price increases apply globally with local market adjustments, meaning Australian dollar pricing will be confirmed closer to the date.

The changes for small and medium businesses:

The standout detail: Business Premium pricing is not changing. For businesses that need the full security stack, and most businesses do, Business Premium just became the most cost-effective option relative to what is included.

New security features bundled into existing licences

Microsoft is raising the security baseline across all plans. Features that previously required separate add-on purchases are now included in standard licences.

Microsoft Defender for Office 365 Plan 1 is being added to Office 365 E3 and Microsoft 365 E3. That means advanced anti-phishing, anti-malware, safe attachment scanning, and link protection is now part of the core licence. If your organisation is on E3 and currently paying for a separate Defender add-on, you may be able to drop that line item.

URL checks in Outlook and Office apps are being added to Business Basic, Business Standard, and Office 365 E1. This protects users when they click links in emails and documents by checking them against known malicious websites. For businesses on managed IT services, this is a welcome addition to the default security posture.

With mandatory ransomware reporting now enforced in Australia, organisations that take cybersecurity seriously need every layer they can get. These changes reduce the gap between basic and premium security. But they do not eliminate it. Business Premium still includes Intune device management, Conditional Access, and Azure Information Protection that the lower tiers lack.

Intune and endpoint management changes

Microsoft is also expanding what is included in its endpoint management tooling. For businesses on Microsoft 365 E3, new Intune capabilities including Remote Help, Advanced Analytics, and Intune Plan 2 features are being added. These tools help IT teams resolve device issues faster, detect problems before they become outages, and manage policies more effectively.

For E5 customers, Microsoft is going further with Endpoint Privilege Management, Enterprise Application Management, and Cloud PKI. These are serious tools for organisations that need to control who can do what on which device, and they are critical for compliance frameworks like the Essential Eight.

If your business relies on a managed IT support provider to handle device management, these additions mean your provider should be reviewing your Intune configuration to ensure the new features are activated and configured correctly. Features that ship disabled are worthless.

Copilot AI is now baked into the platform

Microsoft 365 Copilot Chat, the AI assistant that works across Word, Excel, PowerPoint, Outlook, and OneNote, is now embedded across all Microsoft 365 plans. This is not the full Copilot licence (which still costs extra for advanced features), but it brings AI-powered summarisation, content generation, and calendar intelligence to every user.

For Perth businesses exploring AI adoption, this is a meaningful change. Your staff will have AI tools available whether you have a formal policy or not. That means you need governance in place to manage how AI is used across your organisation. If you have not thought about this yet, a virtual CIO engagement can help you build an AI usage framework that protects your data while giving staff the tools to be more productive.

Why Business Premium deserves a closer look

With Business Basic and Business Standard both going up while Business Premium holds steady, the maths is changing. Business Premium includes everything in Business Standard plus:

At the new pricing, Business Standard will be $14 per user per month and Business Premium will be $22. That $8 gap buys you a full security and device management stack. For most businesses with 20 or more staff, that is a far better investment than bolting on security products individually.

We have been recommending Business Premium to our managed IT clients for some time. This pricing change only strengthens the case.

The renewal window matters

Here is the detail that catches people out: the new prices apply at your next renewal after 1 July 2026. If your annual agreement renews in August 2026, you are paying the new rate. If your agreement renews in June 2026, you lock in the current rate for another 12 months.

This means the timing of your renewal is now a strategic decision. Businesses that act before July can potentially lock in current pricing through mid-2027. Those who wait will pay more from their next renewal onwards.

If you are on a month-to-month arrangement, you will start paying the new rate immediately from July. Converting to an annual commitment before then protects you for a full year.

What you should do now

Audit your current licences. Run a licence utilisation review. Most businesses have users on plans they do not fully use, or users who need features they do not have. Identify where you are over-provisioned and where you are under-protected. Your IT provider should be able to run this audit for you.

Review your renewal dates. Find out exactly when your Microsoft 365 agreement renews. If it falls after 1 July 2026, consider whether early renewal at the current rate makes financial sense. Even a few months of savings across 50 users adds up.

Talk to us about your Microsoft 365 strategy. We are a Microsoft Solutions Partner and we work with Perth businesses every day to optimise their Microsoft 365 environment. Whether you need a licence review, a security uplift, or a full strategy session, we can help you get ahead of these changes. Contact us on 1300 EPIC IT for a free Microsoft 365 review.