Copilot model choice: what the licence covers and what now costs Copilot Credits

For most of 2026 a firm could treat the model picker in Copilot as free. Pick Claude Opus for a careful review, GPT for a quick draft, and the licence covered it. On 25 September Microsoft changed the shape of that deal. The picker still works and most of it is still in the licence. But the frontier models are paid in credits, and heavier models such as Opus are going to come with limits.

This post sets out which side of the line each model sits on, the change coming for Copilot Business on 1 December and what a professional services firm will now pay for. For the model list itself, see our living list of the models behind Copilot.

Everyday AI and advanced AI

Microsoft now groups Copilot work into two kinds and pays for them in two ways.

Everyday AI is what Microsoft expects you to give your whole team: summarising meetings, drafting documents, analysis. It is covered by the per user licence, which Microsoft calls the user subscription licence. Auto, the default setting in the model picker, anchors it. Microsoft describes Auto as weighing accuracy, speed and cost on each request, then routing it to the model and reasoning effort best suited to the job.

Advanced AI is work you hand off: Cowork, Code, Autopilot, the new advanced work in SharePoint and the frontier models. It runs on usage-based billing in Copilot Credits. It sits on top of the licence rather than replacing it, so you need the licence to use it at all.

Our explainer on Microsoft’s new Copilot covers the products on each side. This post is about the models.

Where each model sits

Microsoft has not published a single table, so this one is assembled from its announcements and documentation as at 3 October 2026.

Two rows need a word of explanation.

Opus 5.5 and GPT-6 Sol arrived three days before the pricing change, and Microsoft’s announcement did not say which side of the line they fall in Chat and the Office apps. Its pricing post says newer models such as Opus 5 will be included with limits, and that some capabilities will start on credits and move into the licence as the economics allow. Until Microsoft says more, check the picker in your own tenant.

Copilot Studio works differently. On the standard harness Microsoft’s credit rates are the same for every model it provides, with a premium rate on top when a reasoning model is used, at 10 credits per 1,000 tokens. When a member of your team with a Copilot licence uses an internal agent on the standard or Copilot Chat harness, that is included within fair use. Agents on the GitHub Copilot harness bill everything in credits, including building and testing.

What a usage limit will look like

Microsoft says the licence has always come with fair use and that it is setting limits so the vast majority of people never reach one. Its documentation marks the limit warnings as coming soon.

When they arrive, someone who uses a heavier model a lot will see a warning first. At the limit they choose: switch back to Auto at no extra cost or carry on in Copilot Credits. Carrying on only works if an administrator has set up usage-based billing and put that person in a spending policy.

For a firm that is a reasonable deal. Auto stays in the licence and is good for most work. The cost only appears when someone deliberately keeps choosing the heaviest model, which is exactly the decision you want people to make on purpose.

The 1 December change for Copilot Business

For enterprise customers, usage-based billing stays off until an administrator creates a spending policy in the Microsoft 365 admin centre, and nothing is billed before that. Copilot Business is about to work differently.

From 1 December 2026, new Microsoft 365 Copilot Business licences bought through a Microsoft partner in the Cloud Solution Provider programme come with usage-based billing switched on by default:

• Pay-as-you-go is the default billing setup, so eligible experiences such as Cowork, Work IQ APIs and the GitHub Copilot harness need less setup before they can be used.
• The default spending limit is 4,000 Copilot Credits per user per month. Administrators can change it.
• It applies to new purchases, including bundles. Microsoft’s announcement does not say existing subscriptions change.
• The date was moved from 2 November. The UK is not on the list of markets where it will initially not be available.

The arithmetic is worth doing before the licences arrive. Microsoft’s own example is 100 users with up to 400,000 credits a month. For a 30-person firm the default ceiling is 120,000 credits a month. At the pay-as-you-go rate of $0.01 a credit in Microsoft’s October 2026 credits guide, that is $1,200 a month if every user reached the limit. Charges follow actual usage, so this is a ceiling rather than a bill. It is still the number your finance lead should know, and the one to agree with your partner.

What a firm will now pay for

Still in the licence: Copilot Chat and Copilot in Word, Excel, PowerPoint, Outlook and Teams, Auto, the everyday models, Opus within its limits and everyday work in SharePoint. Internal agents on the standard and Copilot Chat harnesses used by licensed members of your team, within fair use.

Paid in Copilot Credits: every Cowork task, the frontier models, agents and apps on the GitHub Copilot harness, Code, Autopilot, advanced work in SharePoint, Work IQ APIs called from your own agents and model use beyond the licence limits once they arrive.

The rate card for each of those is in Copilot Credits explained, and the full first-year sums for one agent are in what a Copilot Studio agent build costs a 30-person firm.

Five things to set before the meter matters

1. Decide who needs credits at all. Microsoft designed the licence so most people never need them. Name the people who do long, multi-step work and start with them.
2. Create spending policies with caps and alerts. Microsoft lets administrators set budgets at tenant and group level, user caps inside group policies and alerts at a threshold. They can also choose what people see near a limit: a warning, a way to ask for more or nothing at all.
3. If you buy Copilot Business through a partner, agree the default limit now. 4,000 credits per user per month is a ceiling to review before 1 December, not after the first invoice.
4. Use the model family controls as they arrive. Microsoft is rolling out a setting to choose which model families each group can use in Cowork, with more workloads to follow.
5. Tell your team how it works. Auto is the default and sits in the licence. The heaviest models are a choice, and a choice with a cost. Our Cowork credits habits and model picker guide help with the conversation.

The bottom line

For everyday work in Chat and the Office apps, model choice stays in the licence. What changes is that the heaviest models, and anything handed off to Cowork or an agent, now carry a visible price, and for Copilot Business the meter can start on its own from 1 December.

Working out which of your firm’s work belongs on the licence and which justifies credits is part of what Discover settles before anything is built. If you want the sums done for your own licences, book a free 30-minute call.

Sources checked

Last checked: 3 October 2026. Prices are in US dollars and subject to change.

• Microsoft Tech Community, “Evolution of the Copilot pricing model”, 25 September 2026
• Microsoft Learn, “Understanding the user subscription license (USL) and usage-based billing (UBB)”
• Microsoft Tech Community, “Available today: OpenAI’s GPT-6.1 Sol and Claude Sonnet 5.5 in Microsoft Copilot”, 30 September 2026
• Microsoft Tech Community, “More Models, One Copilot”, 22 September 2026
• Microsoft Learn, Partner Center announcements, October 2026
• Microsoft, Copilot Credits Guide, October 2026
• Microsoft Learn, “Billing rates and management”, Copilot Studio
• Microsoft Learn, “Overview of usage-based billing”, GitHub Copilot harness
• Microsoft Learn, “Get started with Copilot in SharePoint”
• Microsoft Learn, “Microsoft Copilot overview”