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Microsoft made significant changes to its nonprofit licensing effective July 1, 2025. If your nonprofit was using Microsoft 365 Business Premium or Office 365 E1 under Microsoft’s free grant program, these changes are now in effect.
Through the Tech for Social Impact program, Microsoft retired the free grants that many organizations relied on for years, replacing them with more limited options.
Here’s what changed, what’s still free, and what your options are.
What Was Retired
Microsoft discontinued two free grant offerings for nonprofits, effective at each organization’s next renewal date on or after July 1, 2025:
- Microsoft 365 Business Premium — free grant discontinued
- Office 365 E1 — free grant discontinued
If your organization was on either of these plans under a nonprofit grant and hasn’t yet transitioned, you need to move to a different licensing arrangement. Microsoft’s own guidance is that grant licences that are not transitioned expire at renewal, with a risk of service disruption and data loss.
What Stays Free
Microsoft 365 Business Basic remains available at no cost for qualifying nonprofits — up to 300 licences per organization.
Business Basic includes:
- Exchange Online — 100 GB mailbox, professional @yourdomain.ca email
- Microsoft Teams — meetings, chat, and calling
- OneDrive — 1 TB cloud storage per user
- SharePoint — shared document libraries and intranet
- Web and mobile versions of Word, Excel, PowerPoint, and Outlook
For many small nonprofits, this covers everything you need for day-to-day operations.
What You Lose Without Premium
If your organization has been running on the free Business Premium grant, moving to Business Basic means losing some features that may be critical to your operations:
- Desktop Office apps — Business Basic only includes web and mobile versions. If your staff needs the full desktop versions of Word, Excel, and PowerPoint, you’ll need Business Standard or Premium.
- Microsoft Intune — device management for laptops and mobile devices
- Defender for Business — advanced endpoint security
- Defender for Office 365 (formerly Advanced Threat Protection) — enhanced email protection
- Conditional Access — granular control over who can sign in and from where
These are significant security and management tools — especially for organizations handling sensitive data (healthcare, social services, legal aid).
Discounted Options
Microsoft is offering up to 75% off many plans for qualifying nonprofits, including:
- Microsoft 365 Business Standard — adds desktop Office apps, Publisher, and Access
- Microsoft 365 Business Premium — adds Intune, Defender for Business, Defender for Office 365, and Conditional Access
- Office 365 E1 — enterprise-grade email and collaboration
The 75% discount makes these plans significantly more affordable than commercial pricing, but it’s still a cost that wasn’t there before.
What You Should Do
If you’re a nonprofit currently on a free Microsoft grant, here’s the action plan:
- Find out what plan you’re on. If you’re not sure, we can check for you.
- Review what features you’re actually using. If you’re only using email, Teams, OneDrive, and SharePoint — Business Basic may be all you need, and it’s still free.
- Assess your security posture. If you’re relying on Intune, Defender, or Conditional Access from Business Premium, you’ll need to budget for the discounted Premium plan or find alternative security tools.
- Plan your transition. If you haven’t already moved, act soon. Licence changes take time to test and roll out properly.
How DVG Systems Can Help
We work with nonprofits across Northern Ontario and manage Microsoft 365 environments every day. If your organization is affected by these changes, we can:
- Audit your current licences and identify exactly what you’re using
- Recommend the most cost-effective plan for your actual needs
- Handle the licence transition with minimal disruption to your staff
- Set up alternative security tools if you’re moving from Premium to Basic
Many of our nonprofit clients stay on the free Business Basic plan with no impact. For those that need Premium features, the 75% discount still makes it an affordable platform for a small organization.
Talk to us about your nonprofit licences →
Or reach us at (807) 700-0061 or solutions@dvgsystems.com.
Sources and last verified
Last verified 11 September 2026. Microsoft’s nonprofit grant and discount terms, and the storage entitlements of each plan, change with Microsoft’s programme updates.
- Announcement: Microsoft 365 Business Premium & Office 365 E1 grant discontinuation, Microsoft Tech Community (Nonprofit Partners): grants discontinued at the next renewal on or after July 1, 2025; up to 300 granted Business Basic licences; discounts up to 75%.
- Microsoft for Nonprofits updates, Microsoft Learn: Office 365 E1 grant discontinued July 1, 2025; up to 300 granted Business Basic licences; up to 75% off Business Standard, Business Premium and E1; transition guidance.
- Microsoft Tech for Social Impact, Microsoft: the nonprofit programme portal.
- Exchange Online limits, Microsoft Learn: Business Basic user mailbox 100 GB.
- OneDrive service description, Microsoft Learn: Business Basic 1 TB per user.
- Microsoft Intune in Microsoft 365 Business Premium, Microsoft Learn: Business Premium includes Intune Plan 1.
- Microsoft Defender for Business FAQ, Microsoft Learn: Defender for Business is included in Business Premium.
DVG Systems is a Thunder Bay-based managed IT provider serving businesses and nonprofits across Northwestern Ontario. We specialize in Microsoft 365, cloud backup, cybersecurity, and managed IT services.