If you manage SharePoint Online, storage pricing can feel deceptively simple - until your tenant starts approaching its limit and you’re forced to choose between paying Microsoft every month or cleaning up what you already have.
This guide explains:
- what storage is included in Microsoft 365
- what the extra storage add-on is (and where to buy it)
- what you should budget
- when it’s cheaper to optimize instead of buying more.
For the full budgeting + forecasting breakdown, see: The real cost of SharePoint storage: capacity and pricing explained
1) What’s included in your Microsoft 365 plan
Most Microsoft 365 tenants include pooled SharePoint storage calculated like this:
1 TB (base) + 10 GB per licensed user
This pooled storage is shared across SharePoint sites in the tenant (including Teams‑connected sites).
An important nuance to consider:
A single SharePoint site can grow very large (up to 25 TB per site), but that doesn’t increase your tenant’s pooled capacity - you still need enough pooled storage available to accommodate a site of this size.
2) What happens when you need more storage
When your tenant exceeds its included pooled storage, the standard path is to purchase Microsoft’s add-on storage offering.
Office 365 Extra File Storage (the add-on)
Microsoft provides extra SharePoint storage via the Office 365 Extra File Storage add-on, purchased in 1 GB increments in the Microsoft 365 admin center.
Two things to know before you plan a purchase:
- If your subscription is via CSP or Volume Licensing, you may not be able to buy it directly from Microsoft in the admin center (you’ll need your partner).
- Your exact purchase flow can differ depending on billing setup (Microsoft Customer Agreement vs older subscription agreements).
3) How much do SharePoint storage add-ons cost?
In most tenants, additional SharePoint storage is commonly seen around:
- $0.20-$0.24 per GB per month (if purchased annually)
- Which is ~$204 per TB per month
However, the price you see can differ slightly by:
- region/currency conversions,
- local taxes, and
- purchase channel (direct vs partner/CSP).
That’s why the most reliable approach is: verify the price shown at checkout inside your tenant before you finalize a budget.
4) How to buy the add-on (quick steps)
Microsoft’s full walkthrough is here: Add more SharePoint storage to your subscription.
4.1) Go to the Microsoft 365 admin center
4.2) Navigate to Billing > Purchase services
4.3) Find "Office 365 Extra File Storage" (This may be named differently in your tenant)
4.4) Review pricing details and process your transaction.
You'll notice a 5% discount for purchasing with an annual billing frequency instead of monthly.
5) When paying Microsoft makes sense (and when it doesn’t)
Buying extra storage can be perfectly reasonable when:
- Your tenant is growing steadily and storage is truly needed
- You’ve already implemented cleanup basics and still need more headroom
But many tenants can delay spending by reclaiming space first. Common culprits include:
- Version history (hundreds of versions per file),
- Inactive sites that no one uses
- Large files that are outdated
- Content lingering in recycle bins / retention scenarios
In practice, it’s common to reclaim a meaningful portion of storage simply by doing structured housekeeping - before you commit to ongoing monthly spend.
6) A cheaper path: optimize before you buy
Before adding paid storage, consider whether you can clean up unnecessary ROT (redundant, obsolete, trivial) content first. On most tenants, 15-30% of storage can be reclaimed.
- Archive inactive sites (or delete where safe)
- Trim excessive version history
- Reduce version history limits globally to prevent unnecessary growth
- Remove large unused files
- Clean up inactive files from within active sites
- Empty recycle bins as part of a routine
If you want to make this repeatable, tools like SProbot help by reporting where storage is going, and turning those insights into cleanup actions.
FAQs
What is the Microsoft add-on called?
Typically Office 365 Extra File Storage, purchased in the Microsoft 365 admin center in 1 GB increments.
Can a SharePoint site really grow to 25 TB?
Yes - up to 25 TB per site, but your tenant still needs enough pooled storage available to support that.
Why does my add-on storage price differ from $0.20/GB?
Pricing can vary by region, currency conversion, taxes, and purchase channel. The best source is the price shown at checkout in your tenant
