Microsoft 365 Copilot is the AI layer built into Microsoft 365 — Outlook, Word, Excel, Teams, and PowerPoint. For UK accounting firms on Microsoft 365, it is the most integrated AI option available, operating within the tools your practice already uses without requiring additional login, prompting platforms, or data to leave your Microsoft environment.

This review covers what Copilot does in each Microsoft 365 app, how it performs for accounting-specific tasks, the data protection position, and whether the investment is justified.

How Microsoft 365 Copilot works

Copilot uses OpenAI's models (currently GPT-4 and above), accessed through the Microsoft Graph — the layer that connects all your Microsoft 365 data. This means Copilot can draw on your emails, documents, calendar, and meeting data when generating responses. It is not a generic AI assistant — it is an AI assistant with access to your firm's data within the M365 environment.

This context awareness is both the key advantage and the main governance point. When you ask Copilot to "summarise last month's client correspondence about the [CLIENT] VAT return", it can actually do that — it searches your emails and documents. This requires that your M365 data governance is in order: documents are stored in SharePoint with appropriate permissions, emails are retained in line with your retention policy, and the data Copilot can access reflects what you want it to access.

Before enabling Copilot, review your Microsoft 365 data governance setup. If permissions are overly permissive, Copilot may surface information from other client files that a user should not be able to access.

Copilot in Outlook

The most immediately useful Copilot feature for most accounting staff is email assistance in Outlook:

Draft email: Copilot generates a draft email from a short instruction. "Draft a reply to John confirming we have received his documents and asking for his pension contribution information" produces a usable draft immediately.

Summarise thread: for long client email chains, Copilot produces a structured summary of the key points, decisions, and action items. Useful when returning to a client matter after a period away.

Email coaching: Copilot reviews a draft email and suggests improvements for tone, clarity, and brevity.

For accounting practices where client email volume is high, the drafting and summary features alone can deliver meaningful time savings. The quality of drafts is generally good, though review for accuracy, tone, and UK-specific content remains essential.

Copilot in Microsoft Teams

Copilot's Teams integration covers meetings and conversations:

Meeting summary: during or after a Teams call, Copilot generates a structured summary of discussion points, decisions, and action items. The summary is accessible within Teams immediately after the call.

Meeting Q&A: you can ask Copilot questions about what was said in the meeting: "What did we agree about the filing deadline?" This is useful for reviewing call content without replaying the recording.

Chat summarisation: Copilot summarises Teams chat threads, useful for long internal discussions or client channels.

The meeting summary feature is the most relevant for accounting practices conducting client calls via Teams. Inform clients before the meeting that Copilot is active and that the call will be summarised — this is a UK GDPR requirement.

Copilot in Word

Copilot in Word handles document drafting within the application:

Draft from prompt: insert a Copilot prompt in a new Word document and receive a first draft. Useful for advisory reports, proposal letters, management accounts commentary, and engagement documents.

Rewrite and refine: select existing content and ask Copilot to rewrite it for a different tone, expand it with more detail, or condense it for brevity.

Summarise a document: generate a summary of a long document, useful for reviewing third-party documents or lengthy prior-year reports before a client meeting.

For accounting firms producing significant volumes of advisory and compliance documentation in Word, Copilot's drafting capability reduces time from blank page to reviewed draft significantly.

Copilot in Excel

Copilot in Excel is particularly relevant for accountants who build management reports, financial models, and analysis in Excel:

Formula generation: describe what you want to calculate in plain English and Copilot suggests the appropriate Excel formula.

Data analysis: ask Copilot to analyse data in a table and identify trends, outliers, or key points. The output is a text summary alongside suggested charts or pivot tables.

Python integration: Copilot can generate Python code within Excel for more complex analytical tasks (available where Python in Excel is enabled).

Note: Copilot in Excel is not a reliable tax calculator. Verify all financial computations — Copilot assists with Excel functionality, not with arithmetic accuracy.

Data protection position

Microsoft 365 Copilot's data protection position is one of its key advantages for UK accounting practices:

  • Data processed by Copilot stays within the customer's Microsoft 365 tenant
  • Copilot does not use M365 customer data to train its AI models (under the enterprise terms)
  • Processing is covered by the Microsoft Data Processing Agreement, which is UK GDPR-compliant
  • Microsoft 365 Business Premium and Enterprise licences include appropriate data residency options

This makes the GDPR compliance position for Copilot simpler than for standalone tools like ChatGPT or Claude — there is no data transfer outside your existing M365 environment. The DPA you already have with Microsoft covers Copilot processing.

Pricing

Microsoft 365 Copilot is available as a per-user monthly add-on to Microsoft 365 Business and Enterprise plans. As of 2026, the add-on price is positioned at a level that requires a reasonable volume of productivity improvement to justify on a per-user basis. Evaluate against the specific time savings in your practice — email drafting and meeting summary are typically the highest-volume features for most accounting staff.

A sensible approach is to pilot Copilot with a small group of staff before a firm-wide rollout. Measure the time savings and adoption rate before committing to a full deployment.

Comparison to other AI writing tools

Copilot's key advantage over ChatGPT and Claude is integration — it works within Outlook, Word, and Teams without switching applications or copying content between tools. For practices where workflow friction matters, this integration advantage is significant.

Copilot's output quality is strong for standard accounting correspondence and document drafting. For highly complex documents where precise instruction following matters over a long output, Claude may outperform Copilot. For prompt community resources and flexibility, ChatGPT's ecosystem is larger.

For UK accounting practices that are already on Microsoft 365 and want a single AI tool with clear GDPR compliance, Copilot is the most practical first choice.

Key takeaways

  • Microsoft 365 Copilot is the most integrated AI option for Microsoft 365 practices, working within Outlook, Teams, Word, Excel, and PowerPoint.
  • The most immediately productive features for accounting staff are: email drafting and summarisation in Outlook, meeting summaries in Teams, and document drafting in Word.
  • Data stays within the M365 tenant and is covered by the Microsoft Data Processing Agreement — the GDPR position is simpler than for standalone AI tools.
  • Review your M365 data governance before enabling Copilot — its context awareness means it can access documents and emails across your tenant, which requires appropriate permissions to be in place.
  • Pilot with a small group first; measure time savings on email and meeting tasks before committing to a full deployment.

Frequently asked questions

Is Microsoft 365 Copilot available on all Microsoft 365 plans?

Copilot is available as an add-on to Microsoft 365 Business Basic, Business Standard, Business Premium, and Enterprise plans. It requires a qualifying M365 base subscription. Check current Microsoft pricing for UK customers, as the add-on pricing and minimum user requirements may have changed since publication.

Can Copilot access client files stored in SharePoint?

Yes — Copilot can access SharePoint files that the user has permission to view. This is the context awareness feature that makes Copilot more useful than a generic AI tool for practice-specific tasks. It also means that SharePoint permissions must be correctly configured before enabling Copilot — if a fee earner has access to all client files in SharePoint, Copilot will be able to draw on all of those files when responding to queries.

Does Copilot work with Xero or other accounting software?

Copilot works within Microsoft 365 applications — Outlook, Word, Excel, Teams. It does not have direct integration with Xero, QuickBooks, Sage, or other accounting software. Data from accounting software would need to be exported to Excel or pasted into Word/Outlook for Copilot to interact with it.

Is Copilot meeting summary feature compliant with UK GDPR?

Copilot's meeting summary in Teams processes meeting audio/transcript data within your Microsoft 365 tenant, covered by the Microsoft DPA. From a GDPR perspective, you must inform meeting participants (including clients) before the call that it will be recorded and summarised. This is a consent requirement under UK GDPR. The processing itself is covered by your M365 data processing agreement.

Should I choose Copilot or ChatGPT for my accounting practice?

If you are on Microsoft 365 and want a single tool with minimal data governance complexity, Copilot is the most practical choice. If you want the best output quality for complex documents and are comfortable managing a separate tool with appropriate data processing terms, ChatGPT Team or Claude for Teams are strong alternatives. Many practices use Copilot for within-M365 tasks (email, meeting notes) and a specialist tool for more complex document drafting.