Free guide: LicensingThe UK SME Guide to Power Platform Licensing

How to use this guide

This guide is for UK organisations of roughly 20 to 500 staff who want to build apps, automations or AI agents on Microsoft Power Platform without overspending on licences or getting caught out after go-live. It is written in plain English and assumes you already have Microsoft 365.

At the time of writing (October 2026). Microsoft changes Power Platform licences, names and prices regularly, often several times a year. Treat every figure and rule in this guide as a starting point, and confirm current terms with Microsoft or your licensing reseller before you buy. Prices quoted are Microsoft list prices in US dollars where Microsoft publishes them that way; GBP prices are set separately, vary by agreement and are reviewed by Microsoft from time to time.

The guide is in four parts:

• Part 1: what you already own, and the one rule that decides most bills (standard versus premium).
• Part 2: the licence options for Power Apps, Power Automate, Copilot Studio and Dataverse.
• Part 3: common SME scenarios and what they usually need.
• Part 4: checklists, mistakes to avoid and questions for your reseller.

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The one-page summary

If you only read one section, read this one.

• Most organisations already own more than they think. Microsoft 365 business and enterprise plans include rights to build Power Apps and Power Automate flows that use standard connectors such as SharePoint, Outlook, Teams and Excel.
• Premium is the line that costs money. As soon as an app or flow uses a premium connector (Dataverse, SQL Server, HTTP, most third-party systems, any custom connector), every person who uses it generally needs a premium licence or a pay-as-you-go plan.
• Licence the people who use it, not just the people who build it. Makers do not need a special licence. Users of premium solutions do.
• There is no clever workaround. Routing premium data through a service account or a single flow so that users avoid licences is called multiplexing, and Microsoft's terms do not allow it.
• AI is metered, not per seat. Copilot Studio agents consume credits (Microsoft previously called them messages). Budget for usage, not just users.
• Dataverse capacity is the hidden cost. Storage entitlement grows with licences, but large file attachments and audit logs can push you over.
• Get it checked before you build. A one-hour review of the design against licensing rules costs far less than discovering a premium dependency after go-live.

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