Note: This article is only for internal use.
Overview:
Starting May 4, 2026, the free grace period for accessing services on non-renewed subscriptions will no longer be available.
If a customer chooses to renew their subscription (Auto-Renew = ON), the renewal will proceed to a new term. There will be no service impact, and no monetary changes will occur unless the product price increases at renewal.
When a Partner turns off Auto Renewal for an existing Microsoft subscription, they need to decide what will happen when the subscription reaches its renewal date.
Customers have two options if they decide not to renew their subscription (Auto-Renew = OFF):
Cancel at Renewal: The subscription will end on the renewal date, and all services will cease. PartnerAdmins will retain data access in accordance with Microsoft's retention policies. There will be no additional billing after the renewal date.
Enter Extended Service Terms (EST): The subscription will continue with monthly billing, and the new pricing will be: Monthly rate plus a 3% increase.
Note: To prevent automatic migration to Extended Service Terms (EST) before May 4, 2026, Microsoft will provide an option starting February 16, 2026, to process a full cancellation at the end of the subscription term. This means there will be no grace period after the subscription expires for accounts with auto-renewal turned off. Cancellations can be made up to 24 hours before the subscription renewal date.
In the Microsoft Partner Center, the "Auto-Renew ON/OFF" option will be replaced with "Renew to New Term," "Renew to EST," and "Cancel at Expiration."
Scope and Impact
The EST policy and supporting features will apply to license-based services across all channels and markets:
CSP: May 2026
MCA-E and Buy Online: February 2026
If auto-renew is turned off and a license-based subscription expires, it will automatically move to Extended Service Terms (EST).
Subscription Eligibility
Subscriptions purchased on and after April 1, 2025, that are: Commercial, Public Sector in CSP, Specialized Offers, and End of Sale with Conversion SKUs.
Subscriptions with an end date on or before May 4, 2026, will be EST-eligible if Auto-Renewal is OFF.
Ineligible Subscriptions
Software, Perpetual, Azure RI, 3PP, Azure SP, Trial, and End of Sales.
Subscriptions purchased before April 1, 2025, are not impacted by this change.
Summary of Changes
Current State | Future State |
|---|---|
After a subscription expires, partners have two options:
| After a subscription expires, the free grace period will be eliminated, and partners/customers must choose one of the following:
|
Extended Service Terms (EST) Policy
Once in Extended Service Terms,
Customers can cancel or start a new full period for any product at any time.
Customers can choose to downgrade or upgrade their services when it's time to renew.
While in Extended Service Terms, their options are limited to what they currently hold. The service terms are set based on the products and quantities that will be active on the renewal date.
As long as customers remain in Extended Service Terms, we will bill them monthly.
Side-by-side comparison of Regular SKU to EST SKU capabilities: https://learn.microsoft.com/en-us/partner-center/customers/extended-service-terms#regular-subscriptions-versus-est-capabilities
Refund Policy
If the customer chooses to renew for a full product, we will refund the remaining amount of their Extended Service Term charge.
Scheduled Orders at Renewal
Any scheduled orders to change the quantity during the Extended Service Terms will be canceled.
If customers turn off auto-renewal before the renewal date, they can still place immediate orders, subject to Microsoft's rules.
Once the renewal date passes and the subscription moves into Extended Service Terms (EST), all options will be locked until they make a final decision.