The free helper knows the internet and whatever you show it. The paid helper can also look through your work emails, meetings and files that you're already allowed to see.
The paid licence, now called Microsoft Copilot, costs £23.10 a user a month in the UK on a yearly plan. Its main difference is that it searches your work content for you, within your permissions, and it gets Copilot inside Word, Excel, PowerPoint and Teams with priority access.
Microsoft Copilot (formerly Microsoft 365 Copilot) adds Work IQ and semantic indexing over Graph content within user permissions, priority access to models and capacity, full in-app experiences, and no-charge employee-facing agent use under the user's identity. UK list: £23.10/user/month, annual commitment, paid yearly, ex VAT, on a qualifying plan.
Names first
Microsoft's documentation now says that "Microsoft 365 Copilot is now named Microsoft Copilot" and that Microsoft 365 Copilot Chat is now Microsoft Copilot Chat. Licences and screens may still show the old names for a while. On this site I say "the Copilot licence" for the paid one and "Copilot Chat" for the one included with Microsoft 365.
The difference in one question
Imagine asking, "What did we agree with the supplier about delivery dates?"
Copilot Chat starts with the web. It can answer from work content only when you hand that content over: paste it, upload a file, have it open, ask from Outlook, or use an agent that's grounded in shared data. See What Copilot Chat can see, and what it can't.
With the Copilot licence, Microsoft says Copilot is grounded in the user's organisational data: emails, meetings, calendars, chats, documents, sites and files the user has permission to access. It finds the relevant thread or meeting notes itself. Microsoft's comparison table shows "Graph API, Work IQ and semantic indexing" as included with the licence and missing from Copilot Chat.
The word to notice is permission. Copilot only sees what the person can already open. If permissions are too loose, Copilot makes that easier to discover, which is why oversharing checks come before rollout.
What else the licence brings
Microsoft's overview lists priority access to Copilot capabilities and to advanced reasoning experiences and models, more comprehensive organisational grounding, access to advanced agents, and the full Copilot experience in Word, Excel, PowerPoint and OneNote. Copilot Chat users get standard access, which depends on available capacity.
There's also a cost effect on agents. Copilot Studio's billing page says employee-facing agents used by a licensed person under their own identity aren't charged in Copilot Credits. For an unlicensed person, an agent grounded in tenant data is. So the licence changes the cost of agents as well as the experience.
Some newer features sit on top of the licence. Cowork is listed as metered for licensed users and needs a spending policy, so a licence alone doesn't switch it on.
The price
Microsoft's UK enterprise pricing page lists Microsoft 365 Copilot at £23.10 per user per month, paid yearly, on an annual subscription, excluding VAT, and it requires a qualifying Microsoft 365 plan. Agreements negotiated with Microsoft or a partner may differ.
A worked example
The numbers below are illustrative. A contracts manager spends roughly 40 minutes a day finding what was agreed in earlier emails and meetings. If the licence cut that to 20 minutes, that would be about 7 hours a month across 21 working days. At an internal cost of £35 an hour, that's about £245 of time against a £23.10 licence.
The same sum for a colleague who searches for past agreements once a week gives a very different answer. That's the reason I'd decide on licences person by person, using real usage and real tasks, as in Working out who needs a Copilot licence.
What I'm still checking
Time saved is the weakest number in the example, because people are poor at estimating it. I'd rather measure it on a few real tasks before and after than rely on a survey. I'm also watching how the September 2026 changes to Home and Cowork shift what the licence alone includes.
Sources
- Microsoft Learn, Microsoft Copilot overview, accessed 11 October 2026.
- Microsoft Learn, Overview of Microsoft Copilot Chat, accessed 11 October 2026.
- Microsoft Learn, Billing rates and management, Copilot Studio, accessed 11 October 2026.
- Microsoft UK, Microsoft 365 Copilot plans and pricing for enterprise, accessed 11 October 2026.