Major Changes To Microsofts Nonprofit Licensing

Microsoft's nonprofit licensing is getting a big shake-up. Starting July 1st, 2025, they're phasing out some of the grant-based licenses and rolling out a new billing and pricing model for nonprofit organisations. If you're using Microsoft 365, Azure, or on-premises software, it's a good idea to take a look at your current setup and get a handle on these big changes.

In this article, we're here to break down these changes and what they mean for you, including updates on costs, what's no longer available, and the steps your nonprofit will need to take to make the transition.

Major Licensing Changes Are Here for Nonprofits – What’s Changing and Why It Matters:

Microsoft Cloud has been a go-to for nonprofits, offering great tools at budget-friendly prices. However, as more people turn to cloud services, Microsoft is tweaking its nonprofit software grants to be more like their commercial licenses. This means big cuts to grants, price changes, and new billing rules. If you don't have a plan, your charity might end up with high costs or service hiccups when it's time to renew.

Annual Prepaid Billing

Microsoft's changing things up for charity licenses. If you want those sweet discounts, you'll need to pay for the whole year upfront. If you decide to go with monthly payments, it'll cost you up to 20% more than the yearly rate. In the UK, this new pricing setup affects Microsoft 365 and Dynamics products, so if you want to keep costs down, annual billing is the way to go.

Microsoft 365 Price Updates for Nonprofits

Starting in 2025, Microsoft is shaking up its nonprofit licensing, which means some price changes are on the way. Here's the scoop on the new prices:

• Microsoft 365 Business Premium: About £4.20 per user/month if you commit for a year

• Office 365 E1: Roughly £2.50 per user/month with an annual plan

• Office 365 E3: Around £5.80 per user/month

• Office 365 E5: About £15.20 per user/month

Don't forget, Microsoft Teams licensing is now separate, so if your nonprofit needs Teams Phone features, expect some extra costs.

Major Grant Changes You Need to Know

Microsoft is making some big changes to its nonprofit grants, moving more towards cloud services and subscription models. If your organisation depends on grants for tools like Azure or Dynamics 365, these changes might affect your costs and IT planning.

• Azure Grant Reduction: The yearly Microsoft Azure grant is dropping from £2,800 to £1,600. This will hit nonprofits and charities using Azure for hosting, storage, or infrastructure. If you go over the new limit, you'll need to cover the extra costs or cut back on services.

• End of Dynamics 365 Sales Enterprise Grant: Microsoft is stopping the free Dynamics 365 Sales Enterprise licenses for nonprofits. From now on, charities using Dynamics for donor management or CRM will have to buy discounted licenses.

• Retirement of On-Premises Donation Programs: Microsoft is also ending its on-premises software donation program. Classic tools like Office Standard and Windows Server won’t be available as free donations anymore, as Microsoft shifts focus to cloud-based solutions.

What This Means for Your Charity’s Tech

Nonprofits sticking with old-school systems are in for some new hurdles. On-site solutions are on their way out, and moving to the cloud isn't just a choice anymore for a lot of organizations. This means nonprofits need to rethink how they plan, manage, and secure their digital setups. Those still using outdated or on-premises systems will feel the heat with more operational pressure, and making the switch adds a whole new level of complexity. This change means nonprofits need to get better at predicting costs, keeping track of licenses, and paying extra attention to security and compliance.

Take Action Before Your Renewal Date

Microsoft's changes to their nonprofit software grants will only kick in when you renew your license. However, it's a good idea to check out your current setup now. This way, you'll have time to plan, budget, and look for discounts, instead of dealing with last-minute decisions and surprise charges.

Need Help Navigating These Changes?

Hey there! High Tide Group is ready to help your nonprofit navigate the Microsoft charity licensing changes coming on June 1st, 2025. We’ll do a Microsoft 365 licensing audit to find the best ways to save you money, assist with your cloud migration, keep costs down for systems like Azure, and help create strategic plans that fit your charity’s goals and budget. Reach out to High Tide Group to futureproof your tech and make the most of your Microsoft benefits.