Microsoft has recently announced significant updates to its non-profit licensing programme that will impact many organisations relying on free Microsoft 365 services. From 1st July 2025, Microsoft will be discontinuing the free grants for Microsoft 365 Business Premium and Office 365 E1.
What’s changing?
The key change is the removal of grant-based (free) licences for the following:
- Microsoft 365 Business Premium
- Office 365 E1
These grants (up to a maximum of 10 licenses) have been widely adopted by charities and non-profit organisations to access enterprise-grade productivity tools at no cost. However, from July 2025, these will no longer be available for renewal.
Importantly, this change only applies to free licenses and does not affect any paid Microsoft 365 subscriptions. If your organisation is currently on a paid plan, your services and pricing remain unchanged.
When is it changing?
These licenses will expire on the next renewal date after the 1st July cut-off, meaning organisations currently using them will need to take action to avoid service disruption.
As an example, if your renewal date is is 25th November 2025, this would be when you would need to start paying for those granted licenses or choose an alternative option.
What is still available?
While the Business Premium and E1 grants are being discontinued, Microsoft continues to support non-profits through:
- Up to 300 free licenses of Microsoft 365 Business Basic – covering key productivity tools such as Exchange, OneDrive, SharePoint, Teams, and web-based Office apps
- Discounts of up to 75% on other Microsoft 365 plans, including Business Premium and Office 365 E1, for eligible non-profit organisations
These options ensure that non-profits can still access powerful Microsoft tools, but organisations will now need to budget for discounted subscriptions if they require the advanced functionality of Business Premium or E1 beyond July 2025.
What’s the difference between Microsoft 365 Business Premium and Microsoft 365 Business Basic?
Business Basic includes essential cloud-based tools such as Exchange email, Teams, OneDrive, SharePoint, and web versions of Office apps like Word, PowerPoint and Excel. Business Premium includes everything in Business Basic plus full desktop versions of Office apps, advanced cyber security features (like Microsoft Defender for Business), device management through Intune, and more comprehensive tools for secure collaboration and productivity. It’s ideal for organisations that need greater control, protection, and flexibility across their IT environment.
What you should do now
If your organisation currently uses Microsoft 365 Business Premium or Office 365 E1 under the non-profit grant programme, it’s essential to begin planning your transition well in advance of July 2025.
Here’s what we recommend:
Audit your current Microsoft 365 usage – Understand how many users are on the affected plans and what features are essential to your organisation
Evaluate alternative plans – Consider Microsoft 365 Business Basic (free for up to 300 users) or explore discounted paid plans
Plan your transition – Work with your IT partner to create a smooth transition strategy that ensures minimal disruption and no data loss
Budget ahead – If a discounted paid plan is necessary to meet your needs, allocate funding in your budget ahead of the renewal date.
Need help navigating the change?
As a Microsoft partner with vast experience supporting charities and non-profits, we can help assess your current setup, explore alternatives, and ensure a smooth transition to the right plan for your organisation’s future. Contact us today to discuss your options.