Supported Microsoft 365 license types

  • Release version: Australia
  • Updated March 12, 2026
  • 2 minutes to read
    • Summarize
    Summarized using AI
    This content was generated using new OpenAI-powered functionality. Results are provided on an as is basis and are not guaranteed to be accurate or complete.

    Summary of Supported Microsoft 365 License Types

    The Microsoft 365 integration supports several license types, enabling customers to access various features and capabilities of Microsoft 365 subscription products and services. Understanding these licenses helps customers decide which option best suits their needs for transitioning to cloud services or upgrading their existing subscriptions.

    Show full answer Show less

    Key Features

    • Full USL: Provides full access to all features of a Microsoft 365 subscription. Ideal for new customers without existing on-premise licenses or those transitioning to the cloud.
    • From SA USL: Allows transition from a perpetual on-premise license to a cloud-based subscription while maintaining certain Software Assurance (SA) benefits. Applicable for customers with an existing perpetual license and active SA benefits.
    • Add-on USL: Enables trial use of cloud capabilities while continuing to use the existing on-premise version. Suitable for those with a perpetual license and active SA benefits who want to explore cloud options without full commitment.
    • Step-up License: Facilitates upgrading from a lower edition to a higher edition of a subscription by paying only the price difference, protecting prior investments in the lower edition.
    • Reserve License: Allows pre-ordering of licenses for Microsoft 365 Online Services, enabling resource planning without immediate purchase orders. Requires prior purchase of a license for the corresponding service.

    Key Outcomes

    By selecting the appropriate Microsoft 365 license type, customers can effectively manage their software investments, transition to the cloud smoothly, and explore new features while retaining the benefits of their existing licenses. This strategic approach ensures cost efficiency and maximizes the value of Microsoft 365 offerings.

    The Microsoft 365 integration supports various Microsoft 365 license types

    Full USL

    A Microsoft 365 Full USL is a user subscription license that provides full access to all features and capabilities of a Microsoft 365 subscription software product or service. You can use this license type under the following scenarios:
    • If have not already purchased licenses for any on-premise Microsoft 365 subscription software products or services.
    • If you want to transition from an on-premise to cloud-based Microsoft 365 subscription software product or service without using Microsoft Software Assurance (SA) benefits.

    From SA USL

    A Microsoft 365 From SA USL is a user subscription license that enables you to transition from a perpetual on-premise Microsoft software product or service to a corresponding cloud-based Microsoft 365 subscription software product or service, while maintaining certain Microsoft SA benefits. You can use this license type if you have already purchased a perpetual license for an on-premise Microsoft software product or service with active SA benefits.

    Add-on USL

    A Microsoft 365 Add-on USL is a user subscription license that enables you to try the features and capabilities of a cloud-based Microsoft 365 subscription software product or service while you are actively using the perpetual on-premise version of that product or service. With this license type, you can try the cloud version of a Microsoft software product or service without having to fully transition to the cloud. You can use this license type if you have already purchased a perpetual license for an on-premise Microsoft software product or service with active SA benefits.

    Step-up license

    A Microsoft 365 Step-up license enables you to upgrade a lower edition of a Microsoft 365 subscription software product or service to a higher edition without having to pay the additional full price for the higher edition. When you upgrade a software product or service through this license type, you are required to pay only the price difference between the lower and higher editions, thereby preserving your initial investment into the lower edition. You can use this license type if you have already purchased the license for a lower edition of a Microsoft 365 subscription software product or service. For more information on Step-up licenses, see Software license maintenance.

    Reserve license

    A Microsoft 365 reserve license enables you to place a license reservation order for a Microsoft 365 Online Services product. With a license reservation order, you can plan and provision additional resources for a Microsoft 365 Online Services product ahead of time without having to create a corresponding purchase order. All license reservation orders are realized during your true-up or annual order process. You can use this license type if you have already purchased a license for a Microsoft 365 Online Services product.