Bookkeeping categories
What category is Microsoft 365 in bookkeeping?
Microsoft 365 is usually categorized as Online Software. Even Margin applies that category automatically when the charge arrives.
What Microsoft 365 is for
Inside Online Software, Even Margin also tags Microsoft 365 by what it is for: Collaboration & Office. It does the same for the 1,300+ tools on its list, so Analytics can show what your software is for: your spend on each kind of tool, side by side in one chart, with Microsoft 365 counted under Collaboration & Office.
What Microsoft 365 charges are
Microsoft 365 bills a subscription for Outlook email, Word, Excel, Teams and OneDrive, usually per user each month or year.
How Even Margin categorizes Microsoft 365
Online Software. Applied automatically, at high confidence.
- Even Margin recognizes Microsoft 365 on your bank transaction, using the merchant list its team curates.
- It categorizes the charge as Online Software with high confidence, so it is applied without asking you.
- Change it whenever you like, and Even Margin keeps your choice.
When a different category fits
Whatever you choose, a rule keeps every Microsoft 365 charge in the same place, including the ones already in your books.
- Microsoft Copilot, billed as its own add-on, stays in Online Software but is tagged AI Tools, so Analytics shows it apart from your office suite.
- Microsoft Teams Phone is a phone system, which is Telephone, SMS & Communications.
- Microsoft Advertising, for ads on Bing, is Advertising & Promotion.
- Microsoft Azure, the cloud platform, is Cloud Hosting & Infrastructure rather than office software.
- A computer bought from Microsoft is equipment rather than a subscription: Office Supplies & Equipment, or wherever your accountant keeps larger purchases.
Is a yearly Microsoft 365 plan still Online Software?
Yes. Monthly or yearly, it is a software subscription. A yearly charge makes that month look heavier, which is worth knowing when you compare months.
Why does my Microsoft 365 charge change from month to month?
Business plans are billed per user, so adding or removing someone changes the charge. The category stays Online Software either way.
About this page
Reviewed 2026-10-08 by the Even Margin team.
These are categories for your books; for how a cost is treated on your tax return, ask your accountant. Merchant names are trademarks of their owners, and Even Margin is not affiliated with them.