Microsoft issues refund to 2.7 million 365 customers over price hike: Check eligibility and how to get refund

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Microsoft has confirmed it will refund Australian subscribers of Microsoft 365 Personal and Family plans following a lawsuit filed by the Australian Competition and Consumer Commission (ACCC). The company was accused of not clearly informing customers about a cheaper non-AI subscription option while introducing AI features into its standard plans.
The refunds will be processed for users who opt to switch to Microsoft 365 Personal or Family Classic — the version without AI-powered Copilot features — by December 31, 2025.

Reason for refund
The ACCC alleged that Microsoft misled users by “deliberately hiding” the cheaper Classic plan option, effectively pushing consumers toward more expensive AI-enabled subscriptions. The regulatory body sought penalties to discourage similar conduct in the future. In response, Microsoft apologized to customers, acknowledging that its communication regarding available options “could have been clearer.” The company reiterated its commitment to transparency and said it would refund the difference in pricing for eligible customers.

Eligibility criteria
Refunds are applicable only to subscribers in Australia who received an official communication from Microsoft about the refund offer. Customers must switch from the current AI-enabled Microsoft 365 Personal or Family plan to the Classic plan before the end-of-year deadline to qualify.

How to claim refund
Eligible users must:
Check for an official refund notification email from Microsoft.
Sign in to their Microsoft account and switch to the Classic plan.
Keep recurring billing enabled for continued service.

Microsoft will automatically process the refund within 30 days of plan switching. The amount will be credited to the original payment method used for the subscription.

Refund timeline and coverage
The refund covers the price difference from the first renewal after November 30, 2024. Once processed, customers can see the refund reflected in their Microsoft account. The move affects millions of Microsoft 365 users in Australia and aims to restore trust after the pricing confusion.