Microsoft to refund customers for 365 subscription price hike: Who is eligible, how to claim refund and more

Microsoft has apologised to its Microsoft 365 Personal and Family subscribers in Australia regarding a subscription alternative. The development comes a week after the Australian Competition and Consumer Commission (ACCC) sued the tech giant for allegedly misleading Australians over its Microsoft 365 subscriptions. The consumer watchdog alleged that the software giant "deliberately hid" cheaper subscription option from Australian customers, seeking a penalty to deter similar behaviour in the future.


Consequently, Microsoft apologised to its 2.7 million customers in the US. "In response to the demand for advanced AI tools, we introduced AI capabilities into the Microsoft 365 Personal and Family subscriptions that we offer in Australia," the company said in a statement. “In hindsight, we could have been clearer about the availability of a non-AI enabled offering with subscribers, not just to those who opted to cancel their subscription,” the company acknowledged.

How Microsoft 365 customers can claim refund

Microsoft has announced that eligible subscribers will receive refunds covering the price difference from their first renewal after November 30, 2024. The company said refunds will be processed within 30 days of switching plans and credited to the original payment method. Once processed, the refund will appear in the customer’s Microsoft account.


Subscribers will receive direct communication from Microsoft outlining their options. To claim a refund, customers should:

• Check eligibility: Confirm receipt of an official refund message from Microsoft.
• Switch plans: Move to Microsoft 365 Personal or Family Classic plans by December 31, 2025.
• Automatic processing: Microsoft will calculate and issue the refund once the plan switch is complete.
• Refund timeline: Funds will be returned within 30 days to the original payment method.

Customers who prefer to cancel or change plans manually can visit Microsoft’s account services page and sign in with their subscription account. Full details on cancellations and refunds are available on Microsoft’s official support site.

Full text of email Microsoft is sending to its customers

Your Microsoft 365 Options

See your Microsoft 365 Subscription options and refund eligibilityIn October 2024, we announced changes to our Microsoft 365 pricing for subscribers in Australia. We recognise we could have been clearer in our communications about the full range of Microsoft 365 subscription options including the option to switch to Microsoft 365 [Personal/Family] Classic. Our relationship with our customers is based on trust and transparency and we apologise for falling short of our standards.We want to ensure you have all the information you need to make the choice that’s right for you, so we are sharing that information below, including the opportunity to receive a refund.Option 1: Stay on Microsoft 365 [Personal/Family], your current planMicrosoft 365 [Personal/Family] includes the core Microsoft 365 apps plus our AI assistant Copilot and ongoing feature updates.Microsoft 365 [Personal/Family] renews at [$16/$18 AUD per month tax inclusive].If you wish to stay on Microsoft 365 [Personal/Family], no action is needed.Option 2: Switch to Microsoft 365 [Personal/Family] Classic and receive a refundWhile Microsoft 365 [Personal/Family] Classic includes the core Microsoft 365 apps and regular security updates, it does not include our AI assistant Copilot and may not receive new feature updates.Microsoft 365 [Personal/Family] Classic renews at [$11/$14 AUD per month tax inclusive], the price you paid before the increase.If you want to continue using Microsoft 365 [Personal/Family] Classic after you switch plans, you’ll need to keep recurring billing enabled.If you switch to Microsoft 365 [Personal/Family] Classic by 31 December 2025, we’ll refund the difference in price between plans, starting from your first renewal date after 30 November 2024. We’ll process your refund to the payment method you use to subscribe within 30 days. Once the refund has been processed, it will be reflected in your Microsoft account. This refund option is only available to subscribers in Australia who receive this email and switch to the Microsoft 365 [Personal/Family] Classic plan by 31 December 2025.Thank you for being a Microsoft 365 subscriber. We’re committed to making this process clear and improving your experience.