Free tool

Microsoft 365 licensing cost calculator

Pick what your business actually needs and see what it costs three different ways: Business Premium plus add-ons, E3 plus add-ons, or E5. The calculator buys the suite instead of the parts whenever the suite is cheaper, and it will not charge you for something your base plan already includes. Which is where most licensing budgets go wrong.

Prices verified August 3, 2026. Reviewed quarterly. Next review November 3, 2026. Microsoft raised list prices and changed what several suites include on July 1, 2026, so older comparisons are wrong in both directions.

What changed on July 1, 2026

Microsoft raised list prices and changed what several suites include on the same day. Both halves matter, and most published comparisons only caught the first one.

Price changes

SKUWasNow

Microsoft 365 E3 $36.00 $39.00

Microsoft 365 E5 $57.00 $60.00

Microsoft 365 Business Premium $22.00 no change

Microsoft 365 Business Standard $12.50 $14.00

Microsoft 365 Business Basic $6.00 $7.00

Office 365 E3 $23.00 $26.00

Office 365 E5 $38.00 $41.00

Microsoft 365 F1 $2.25 $3.00

Microsoft 365 F3 $8.00 $10.00

Entra ID P1 $6.00 $7.00

Entra ID P2 $9.00 $10.00

Per user, per month. Existing customers stay on their current price until the first renewal after July 1, 2026.

Packaging changes

Microsoft 365 E3 now includes Intune Plan 2, Intune Remote Help, Intune Advanced Analytics, and Defender for Office 365 Plan 1 at no extra cost. If you are still budgeting those as add-ons, stop.
Microsoft 365 E5 adds Microsoft Security Copilot, Intune Endpoint Privilege Management, Microsoft Cloud PKI, and Intune Enterprise Application Management.
Microsoft 365 E5 Security was renamed Microsoft Defender Suite and Microsoft 365 E5 Compliance was renamed Microsoft Purview Suite. Both need Microsoft 365 E3, or Office 365 E3 with EMS E3, as the base plan.
Business Premium is no longer an eligible base for those enterprise suites. It gets its own editions instead: Defender Suite for Business Premium at $10, Purview Suite for Business Premium at $10, or both together for $15, all capped at 300 seats. Cheaper than the enterprise versions, and most published comparisons have not caught up.
Business Basic, Business Standard, and Business Premium each pick up 50 GB of extra mailbox storage.

The three decisions that actually move the number

1. Are you under 300 seats?

If you are, Business Premium at $22.00 is the strongest value in the Microsoft catalog, and it has its own editions of the Defender and Purview suites. Business Premium plus both of them is $37.00 per user per month against $60.00 for E5, for a feature set that is close to identical for most businesses. At 250 users that gap is $69,000 a year. Note that the $12.00 enterprise suites will not attach to Business Premium, which is the single most common error in published licensing comparisons.

2. Do you need Defender, Purview, or both?

This is the whole E3 versus E5 question. E3 is $39.00. Add the Defender Suite and you are at $51.00, still under E5. Add the Purview Suite as well and you are at $63.00, over E5. One suite, stay on E3. Both suites, buy E5. That is the break-even, and it does not move with seat count.

3. Does everyone need the same license?

Almost never. Shop-floor, clinical, and field staff who share a device and barely touch email usually belong on F1 at $3.00 or F3 at $10.00, not on a full knowledge-worker seat. Mixing license types in one tenant is fully supported, and on a mixed workforce it is usually the largest single saving available.

Other Microsoft 365 list prices

Plans and add-ons outside the three-way comparison above, for reference.

Microsoft 365 Business Basic $7.00 / user / mo Web and mobile Office only. No conditional access, no Intune. 300-seat cap.

Microsoft 365 Business Standard $14.00 / user / mo Desktop Office, no security stack. 300-seat cap.

Microsoft 365 Apps for business $10.00 / user / mo Desktop Office apps only, no email.

Office 365 E1 $10.00 / user / mo Web-only Office, no seat cap, no conditional access.

Office 365 E3 $26.00 / user / mo Office and email at enterprise scale, no Windows or Intune.

Office 365 E5 $41.00 / user / mo Office 365 E3 plus the security, compliance, and voice stack.

Microsoft 365 F1 $3.00 / user / mo Frontline. No mailbox rights, but it does carry Entra ID P1 and Intune Plan 1.

Microsoft 365 F3 $10.00 / user / mo Frontline with a 2 GB mailbox, web and mobile Office, Entra ID P1, and Intune Plan 1.

Microsoft Defender for Business $3.00 / user / mo Standalone endpoint protection and EDR-lite. Included in Business Premium. 300-seat cap.

Microsoft Entra Suite $12.00 / user / mo Entra ID P2 plus Internet Access, Private Access, ID Governance, Verified ID.

Microsoft Intune Suite $10.00 / user / mo Every Intune add-on in one line, on top of Plan 1.

EMS E3 / EMS E5 $12.00 / user / mo EMS E3 is $12, EMS E5 is $18. Entra plus Intune, no Office.

Microsoft 365 licensing questions

Is Microsoft 365 E5 worth it over E3?

It depends on how much of the stack you will actually turn on. E5 is $60 per user per month. E3 is $39, and adding the Defender Suite brings it to $51, which is cheaper than E5 if you do not need advanced Purview compliance. Add the Purview Suite too and E3 lands at $63, which is more than E5. So the break-even is simple: if you need both the full Defender stack and advanced Purview, buy E5. If you need one or the other, E3 plus that suite is cheaper.

What is the 300-user limit on Microsoft 365 Business Premium?

Microsoft caps the entire Business family (Basic, Standard, and Premium combined) at 300 seats per tenant. Once you need seat 301 you cannot buy another Business license. You can keep the 300 Business Premium licenses you have and license the rest on E3 or E5 in the same tenant, which is fully supported and usually cheaper than converting everyone to Enterprise.

Can I add the Defender Suite or Purview Suite to Business Premium?

Yes, but not the enterprise versions, and this is where most published comparisons are wrong. Microsoft removed Business Premium as an eligible base plan for the $12 Defender Suite and the $12 Purview Suite in May 2025; those now require Microsoft 365 E3, or Office 365 E3 with EMS E3. Business Premium has its own editions instead: Defender Suite for Business Premium at $10, Purview Suite for Business Premium at $10, or both together for $15, each capped at 300 seats. So Business Premium plus the full security and compliance stack is $37 per user per month against $60 for E5, not the $46 you will see quoted elsewhere.

Did Microsoft 365 prices go up in 2026?

Yes, on July 1, 2026. Microsoft 365 E3 went from $36 to $39, E5 from $57 to $60, Business Standard from $12.50 to $14, Business Basic from $6 to $7, Office 365 E3 from $23 to $26, and Office 365 E5 from $38 to $41. Business Premium held at $22. Existing customers stay on their current pricing until their next renewal after July 1.

What is now included in E3 that used to cost extra?

As of the July 2026 packaging update, Microsoft 365 E3 includes Intune Plan 2, Intune Remote Help, Intune Advanced Analytics, and Defender for Office 365 Plan 1 at no additional cost. A lot of licensing comparisons still show those as paid add-ons, so budgets built on older guidance overstate the real cost of E3.

Are these the prices I will actually pay?

These are Microsoft published list prices on an annual commitment, billed annually. Paying monthly on an annual term runs about 5 percent higher. Nonprofit, government, and education pricing is different, and buying through a partner can change the number in either direction. Use this to size the decision, then get a quote against your real seat count.

Do you resell Microsoft licensing?

Yes. Desert Lakes is a Microsoft partner and licensing is included in our managed IT bundles rather than billed as a separate line. Trailhead and Ridgeline include Business Premium for every user, and Summit includes E5. If you would rather buy licensing on its own, we will still tell you which path is cheapest.

Where these numbers come from

Every price on this page is Microsoft published list pricing, verified August 3, 2026 against the sources below. We re-check the whole file quarterly and the next review is November 3, 2026. If Microsoft moves a price between reviews, the date above is how you will know this page has not caught up yet.

This page prices three paths against the capabilities you pick. If the harder question is which licenses your different kinds of staff should be on in the first place, the Microsoft 365 license decision tree asks five questions and returns a SKU mix for the whole organization with the reasoning shown. Weighing licensing as part of a bigger IT decision? The in-house vs outsourced IT cost calculator puts licensing, tooling, and salaries in one number, and our own pricing includes Microsoft licensing rather than billing it separately.

Have us check your tenant against your bill

Most tenants we look at are paying for licenses nobody uses and missing a suite that would cost less than the parts. Send us your current license counts and we will tell you which way the math runs.

Call (855) 737-9500 / (480) 573-3349

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