In an external Azure tenant can I purchase MS 365 licenses and assign them to internal users of the external tenant

Question

In an external Azure tenant can I purchase MS 365 licenses and assign them to internal users of the external tenant

PAB 20

I have a workforce tenant and a new external tenant.
I added internal users to the external tenant with new email addresses that are not in my workforce tenant.
I am trying to purchase MS 365 Business Basic licenses for the new internal users. Each time I purchase the product, it does not show in my available products, and I cannot assign the license to the internal user.
Is the ability to purchases licenses and add to internal not available? Do I need a workforce tenant to be able to add products/licenses for internal users? Or have I configured something incorrectly in my external tenant?

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Answer 1

Akhilesh Vallamkonda 13,060 Microsoft External Staff

Hi @PAB

Thank you for reaching Microsoft Q&A forum!

I understand that you would like to purchase licenses in Microsoft Entra External tenant and assign it to users who existed in the External tenant.
The Microsoft Entra External tenant is in preview, features or capabilities that require a premium license are unavailable in external tenants.
Microsoft 365 Business Basic licenses are typically tied to the tenant where they were originally purchased, these licenses cannot be transferred directly from one tenant to another.
Adding, removing, and reprocessing licensing assignments is only available within the M365 Admin Center. Go to M365 Admin Center
Instead of assigning a license to a single user you can assign licenses to security groups and the users to the security group to assign licenses automatically.
In summary you can purchase and assign licenses in workforce tenant and tenant user. In Microsoft Entra External tenant feature is unavailable.

Reference: https://learn.microsoft.com/en-us/microsoft-365/admin/manage/assign-licenses-to-users?view=o365-worldwide
Hope this helps. Do let us know if you any further queries by responding in the comments section.

Thanks,

Akhilesh V.

If this answers your query, do click Accept Answer and Yes for was this answer helpful. And, if you have any further query do let us know.

PAB 20 Reputation points

2025-02-07T21:04:19.8+00:00
Thank you... just to confirm i understand your response:

I created an External Tenant.

I added new internal users in that External Tenant.

I purchased MS Business Basic via the External Tenant, but that really wasn't a purchase after all that is not allowed in the External Tenant?

Since External Tenant is in preview mode, I can only purchase MS Business Basic in the Workforce Tenant and assign licenses to internal users in the Workforce Tenant.

So no premium license are allowed on internal users in an External Tenant?

I appreciate if you would confirm that what I said above is correct based on your response, and thanks again.
Akhilesh Vallamkonda 13,060 Reputation points Microsoft External Staff

2025-02-10T18:47:38.4466667+00:00

Hi @PAB
Firstly, the external tenants are not for internal users. External tenants are designed for guest users who need access to resources in your organization.
you can purchase licenses for your internal users in your home tenant, which is "workforce tenant" assign these licenses to your internal users.
In Entra External Tenant currently there is no option to purchase and assign the license due to preview.
For more information Supported features in workforce and external tenants

If this answers your query, do click Accept Answer and Yes for was this answer helpful. And, if you have any further query do let us know.
PAB 20 Reputation points

2025-02-10T21:40:29.91+00:00
Thank you again for your help. I have read that linked article before, but for EXTERNAL Tenants it indicates

"Local accounts are supported for:

External users (consumers, business customers) who use self-service sign-up.

Accounts created by admins."

Therefore, I thought I was following the "Accounts created by admins" path, which would be internal users created by admins in the EXTERNAL tenant. So the description is somewhat confusing. It does not indicate that licenses cannot be given to these "Accounts created by admins."

Perhaps "Accounts created by admins" are guest users invited by the admin?
Akhilesh Vallamkonda 13,060 Reputation points Microsoft External Staff

2025-02-11T22:31:12.43+00:00

@PAB
Let me explain
Create new external user: Create a new user in your external tenant configuration. This user can sign in to your external tenant configuration with a unique identifier (for example, email address or username) this is for external users whom you want to add with their ids.
Create new user: Create a new user in your organization. This user will have a username like ******@contoso.com.
Accounts that an admin manually creates within the tenant. These can be either internal users or guest users.
Akhilesh Vallamkonda 13,060 Reputation points Microsoft External Staff

2025-02-13T10:03:30.6766667+00:00

Hi @PAB
If this answers your query, do click Accept Answer and Yes for was this answer helpful. And, if you have any further query do let us know.
PAB 20 Reputation points

2025-02-14T16:03:49.2833333+00:00

Thanks again for your help. Microsoft did finally confirm that what I was trying to do in the External tenant is not valid.
Bernd Flatz 0 Reputation points

2025-03-05T14:01:48.8433333+00:00

Microsoft Entra External ID is not in preview anymore since end of last year. So this information is not correct.

For example, if you want to verify a publisher of an app registration, you need a valid email address in the Entra External ID tenant. Therefore, I must also have the option to purchase a license so that I can set this up.

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In an external Azure tenant can I purchase MS 365 licenses and assign them to internal users of the external tenant

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