Microsoft Teams comes bundled inside Microsoft 365, and eligible nonprofits can get it free as part of the donated Business Basic plan — or at a steep discount on higher tiers. But Microsoft changed the program in mid-2025, ending one popular free grant. Here’s the accurate 2026 picture.
What Changed in 2025
The most important update: as of July 1, 2025, Microsoft no longer offers free grant licenses for Microsoft 365 Business Premium and Office 365 E1. Nonprofits that relied on free Business Premium have had to move to Business Basic (still free) or pay the discounted Business Premium rate.
If your nonprofit was running on a free Business Premium grant, this is the change that affects your budget — plan for either the free Basic tier or the discounted Premium.
What Nonprofits Get in 2026
| Plan | Nonprofit price | Teams included? |
|---|---|---|
| Microsoft 365 Business Basic | Free (up to 300 users) | Yes |
| Microsoft 365 Business Premium | ~75% off list price | Yes |
- Business Basic is donated free for up to 300 users — and it includes Microsoft Teams, web/mobile Office apps, business email, and 1 TB of OneDrive storage per user.
- Business Premium (desktop Office apps + advanced security: device management, cyberthreat and endpoint protection) is available at roughly 75% off the standard commercial price for eligible nonprofits.
For most small and mid-size nonprofits, the free Business Basic tier covers everything they need — Teams, email, and cloud Office — at no cost.
Why Teams Is Compelling for Nonprofits
Unlike a standalone chat tool, the Microsoft 365 nonprofit grant bundles Teams with the things a nonprofit office actually runs on:
- Business email on your own domain
- Word, Excel, PowerPoint (web/mobile on Basic; desktop on Premium)
- OneDrive + SharePoint file storage
- Teams for chat, meetings, and calls
That bundling is the real argument: where Slack’s nonprofit discount gives you excellent chat, the Microsoft grant gives you chat plus the whole productivity suite for free.
Eligibility
- Recognized nonprofit/charitable status (validated by Microsoft’s eligibility partner)
- Not on the excluded-organization list (similar restrictions to other vendor programs)
- Apply through the Microsoft for Nonprofits portal for a product grant or discount
Verdict
For a registered nonprofit, Microsoft 365 Business Basic is free for up to 300 users and includes Teams — making it one of the best-value collaboration grants available. Just remember the 2025 change: the free Business Premium grant is gone; Premium is now ~75% off, not free. If you only need Teams, email, and web Office, Basic costs nothing.
Weigh it against video-first and chat-first options: see the Zoom nonprofit discount and Slack for Nonprofits. For standard plan differences, see Microsoft Teams pricing.
Frequently Asked Questions
Is Microsoft Teams free for nonprofits? Yes — Teams is included in the free Microsoft 365 Business Basic grant, donated for up to 300 users to eligible nonprofits.
Did Microsoft stop free Business Premium for nonprofits? Yes. As of July 1, 2025, the free grant for Business Premium and Office 365 E1 ended. Business Premium is now available at roughly 75% off instead of free.
How many users does the free plan cover? The donated Business Basic plan covers up to 300 users.
What’s the difference between Basic and Premium for nonprofits? Basic (free) includes Teams, email, and web/mobile Office. Premium (~75% off) adds desktop Office apps and advanced security like device management and threat protection.