A reference article covering Business Central’s licensing model, storage entitlements, and the cost items that typically get missed at proposal stage.
Licensing Model Overview
Business Central (SaaS/cloud) is licensed on a per-user, per-month, named-user subscription basis, billed annually (monthly and 3-year commitment options also exist). There are four license types:
| License Type | Purpose |
| Essentials | Full Access License covering all modules except for Manufacturing and Service Management. |
| Premium | Everything in Essentials + Manufacturing and Service Management |
| Team Members | Read-mostly access approvals, timesheets, basic entry for occasional users. |
| Device | Shared license tied to a device rather than a named user (shop floor / warehouse terminals) |
Important licensing rule:
You cannot mix Essentials and Premium Full Users in the same environment if even one user needs manufacturing/service management, all full users in that environment must be licensed as Premium. If only a subset of your users need Premium capabilities, the workaround is to run a separate environment (Essentials for one group, Premium for another) though this has storage and management implications (see Section 3).
Current List Pricing
Microsoft raised Business Central pricing for the first time in over five years, effective November 1, 2025 (originally announced for Oct 1, then pushed back).
| License | Price from Nov 2025 |
| Essentials | $80/user/month |
| Premium | $110/user/month |
| Team Members | $8/user/month |
| Device | $45/month |
These are US list prices. Actual invoiced pricing for KSA/GCC clients will typically come through a CSP partner in local currency (SAR) with the partner’s margin applied, so treat the above as a benchmark for TCO conversations rather than a quote.
Data Storage Capacity
This is the part clients (and sometimes partners) misunderstand, so it’s worth being precise.
Base Entitlement
Every Business Central tenant (Not Per Environment) gets a shared base entitlement:
- 80 GB base database storage, shared across all environments (production + sandbox) in that tenant.
Per User Allowance
| License | Storage / User (Post Nov 2025) |
| Essentials | 3 GB |
| Premium | 5 GB |
| Device | 1.5 GB |
Example: A tenant with 15 Premium users gets 80 GB + (15 × 5 GB) = 155 GB of shared capacity across all environments.
What Counts Against Capacity
- All production and sandbox environments in the same tenant draw from the same shared pool.
- File attachments, posted entries, extension/app data, and Copilot-related data all count.
- If the tenant exceeds its limit, Microsoft doesn’t block transactions immediately, but it restricts admin actions most notably, you can’t spin up additional environments until you’re back under the limit or buy more capacity.
Environments — What’s Included, What Costs Extra
Every Business Central tenant with Essentials or Premium licenses includes, free of extra charge:
- 1 Production environment
- 3 Sandbox environments
- 3 External Accountant licenses
- Up to 300 companies in a single environment (no per-company fee)
Buying additional environments
If a client needs a second production environment (e.g., separate legal entity, separate country deployment, or an Essentials + Premium split as mentioned in Section 1), Microsoft sells the Additional.
It will Cost $300 / tenant / Month.
Buying more storage
If a client’s data volume (common in manufacturing, high attachment-volume, or long-retention scenarios) exceeds the entitlement:
| Add-on | Approx. Price |
| Database Capacity (1 GB) | $10 / month |
| Database Capacity (100 GB) | $500 / month (Bulk Rate, ~$5/GB) |
Partner Sandbox environments
Separate from the above, partners can license Partner Sandbox environments at ~$6/user/month (5-user minimum), which include 1 production-equivalent + 3 sandbox environments and can run on Early Access Preview builds. Useful for your own internal demo/dev tenants rather than client production use.
Quick Reference — Building a Client TCO Estimate
A defensible total cost of ownership conversation should walk through:
- License cost = (Essentials or Premium users × Rate) + (Team Member users × $8) + (Device licenses × $45), Annualized (Multiple by 12)
- Implementation (one-time)
- Storage Overage, only if the user-count-derived entitlement is realistically going to be exceed (rare for SMB clients in year 1, common for manufacturing/high-volume clients by year 2–3)
- Additional environments, only if the client genuinely needs a second production environment (multi-entity, Essentials/Premium split, or regional separation)
- Annual support/managed services (Discussion with Partner)