How to Choose a Copilot Plan: Free, Microsoft 365 or Business

The short version

Pick by where you want Copilot to work. For chatting, the free app is enough. For Copilot inside Word, Excel, PowerPoint, Outlook and OneNote at home, you need a Microsoft 365 home plan. For work data and company-level protection, you need a business plan. Prices below are US prices from Microsoft’s pages, checked October 29, 2026.

Step by step

1. Try the free version first. Sign in at copilot.microsoft.com or in the Copilot app and use it for a week. Note what you hit: usage limits, or wishing it worked inside your documents.
2. Check what you already pay for. Open your Microsoft account’s subscriptions. If you have Microsoft 365 Personal or Family, Copilot in the Office apps may already be included.
3. Match the plan to the job using the table below.
4. At work, ask IT first. Your company may already give you Copilot Chat, or a full license.

Home plans

Business plans

Microsoft says Copilot Chat is included at no extra cost with eligible Microsoft 365 business plans: web-grounded chat, Copilot in Outlook and the Copilot app, with enterprise data protection.

For more, businesses buy Copilot (annual commitment, per user per month):

• Microsoft 365 Copilot Business add-on: $21 ($18 promotional for the first year on offers from July 1 to December 31, 2026)
• Microsoft 365 Business Standard with Copilot: $23.50
• Microsoft 365 Business Premium with Copilot: $32.00

Microsoft says a license adds priority access, Copilot across your emails, meetings, chats and files, and advanced agents such as Researcher and Analyst.

Prompts to copy

Use Copilot itself to sanity-check your choice:

I use Word and Excel about three hours a week for a small side business.
I mostly need help drafting letters and making simple formulas.
What should I compare between the free Copilot app and Microsoft 365 Personal?

Example

A retired teacher who writes a church newsletter in Word: Microsoft 365 Personal gives Copilot inside Word. A family of five sharing one subscription: only the owner gets the AI features, so whoever writes most should own the plan. A 12-person office: start with the Copilot Chat they already have, then license the few people who’d use Copilot in Outlook and Teams every day.

Mistakes to avoid

• Paying before trying free. Many people only need chat.
• Assuming Family means AI for everyone. It’s the owner only.
• Using a personal plan for company data. Work accounts get enterprise data protection; personal ones don’t.
• Trusting old price lists. Microsoft changes plans often. Check the live pages in the sources.

Good to know

Microsoft describes the paid home plans as adding “advanced Copilot chat” with higher usage than free, plus Copilot inside the Office apps. For a walkthrough, see how to use Microsoft Copilot.

Related: use Copilot Chat at work and use GitHub Copilot in VS Code.