Microsoft's own comparison table lists forty features and tells you almost nothing useful. Here is the version that answers the question people actually have, which is which one should we be on.

The short answer

  • Business Basic — for people who work in a browser and on a phone. Email, Teams, file storage, web versions of the Office apps.
  • Business Standard — Basic plus the proper desktop applications. The default for most office-based staff.
  • Business Premium — Standard plus the security and device management layer. The right answer for any business that holds client data or answers security questionnaires.

All three cap at 300 users, and all three can be mixed within one tenancy.

Business Basic: who it genuinely suits

Basic is not a cut-down plan, it is a different shape. You get the full email service with a 50GB mailbox, Teams, SharePoint, 1TB of OneDrive per person, and the web and mobile versions of Word, Excel, PowerPoint and Outlook.

It suits field staff, drivers, site teams, part-time and seasonal workers and anyone whose entire working day happens on a phone plus the occasional web form. For those people the desktop applications are genuinely unused and paying for them is waste.

Where Basic fails is with heavy spreadsheet work, complex documents, offline working and anyone who needs the full Outlook client for shared calendars and rules. If somebody keeps asking why Excel is missing a feature, they are on the wrong plan.

Business Standard: the sensible default

Standard is Basic plus the installed desktop applications on up to five PCs or Macs and five mobile devices per person, plus webinar hosting and Microsoft Bookings.

For most office-based staff this is the right plan and there is little to debate. The desktop applications are meaningfully better than the web versions for real work, offline access matters more than people expect and the five-device allowance covers the laptop, the home machine and the phone without anybody bending the rules.

Business Premium: what you are actually buying

This is where the comparison table stops helping, because the additions are not features people can see. They are controls.

Intune device management

The ability to require a device to be encrypted and up to date before it can reach company data, to push settings to every laptop without touching them and — the one that earns its money — to wipe company data from a lost phone without wiping the owner's photographs.

Any business where staff use their own phones for work email has a real gap here, and Intune is the standard answer to it.

Entra ID Plan 1 and conditional access

Conditional access is the rule engine that lets you say things like multi-factor authentication is required unless the device is company-managed and on a known network, or block sign-ins from outside the UK. It is the difference between security that irritates people constantly and security that appears only when the situation is unusual.

Defender for Office 365

Attachment and link protection that opens and tests things before your staff do. Given that email remains the way almost every incident starts, this is the control with the most direct bearing on whether you have a bad year.

Information protection

Sensitivity labels that follow a document rather than living on a folder, so a file marked confidential stays restricted after somebody emails it onwards.

Premium is not a productivity upgrade. It is the plan where Microsoft 365 stops being a set of applications and starts being something you can put controls around.

When the upgrade pays for itself

Four situations where we would recommend Premium without hesitating:

  • You are asked to complete client security questionnaires. Premium answers most of the questions. Standard does not, and the gaps are visible.
  • You hold personal data at any scale. Health, finance, education, recruitment, professional services.
  • Staff use personal devices for work. Very common and rarely managed.
  • You want or hold Cyber Essentials. Premium makes several controls straightforward that are otherwise fiddly.

Buying Intune, Entra ID Plan 1 and Defender for Office 365 separately on top of Standard costs substantially more than the step to Premium. If you find yourself pricing any two of them individually, you have already made the case.

Mix the plans

The most common licensing mistake in UK small businesses is uniformity — everybody on the same plan because it is simpler to administer. It is simpler, and it is usually more expensive.

A twenty-person business might sensibly run twelve Business Premium for office staff who touch client data, six Business Basic for site teams and two shared mailboxes on no licence at all. That mix is fully supported and typically saves fifteen to twenty per cent against a uniform Premium estate.

Before you renew

Run the licence audit described in this article on the 2026 price change. Stale licences, unlicensed-eligible shared mailboxes and people on plans they do not need typically release enough budget to fund the Premium upgrade for the staff who genuinely need it.

If you would like the audit and the plan mapping done properly, our managed IT team does this routinely for UK businesses and will give you a per-person recommendation rather than a blanket one. Ask us for a licensing review.