PHOENIX, AZ – October 14, 2026 – Microsoft has confirmed that Copilot and agent capabilities in Dynamics 365 Business Central require the online service. Tigunia, a Microsoft Solutions Partner, is breaking down what that means for on-premises customers, including what they continue to receive and why the distinction matters for planning.
“We get asked about Copilot all the time, but the conversation quickly becomes more about ‘which Business Central am I actually running,’” said Christopher Brock, director of sales at Tigunia. “Two companies can both say their system is hosted and mean different things, and that has to be clear before anyone can plan around AI.”
Microsoft states the position in two places. Its 2026 release wave 1 overview for Business Central says that “Copilot and agents are available only to Business Central online customers.” Its list of features not implemented in on-premises deployments says that “Copilot in Business Central is available exclusively for Business Central online.”
Microsoft continues to ship its Business Central updates to on-premises deployments, including update 28.0, but the Copilot and agent capabilities in that update are still gated to the online service. On-premises customers must install these updates manually rather than automatically, and Microsoft’s update cycles page doesn’t state how long the gap between an online release and its on-premises cumulative update tends to be.
Business Central update 28.0, part of 2026 release wave 1, lists seven new or updated Copilot and agent entries at general availability. Microsoft names two of them “Manage tasks from all agents in dedicated task pane” and “Review content generated by agents directly on pages.”
Moving to a new major version is a separate question from what an update contains. Microsoft states that “Deployments using version 24 or earlier must upgrade to version 25 before upgrading to version 28.”
Deployment type is worth establishing early. An absent Copilot feature doesn’t by itself mean an environment is on-premises. An administrator can turn individual features off from the Copilot and agent capabilities page, and availability also depends on region, data location, and language.
Partner-hosted arrangements are the hardest case to read from the outside. Tigunia’s own published guidance on Business Central hosting sets out two partner-hosted scenarios. One is a managed online tenant in the Microsoft cloud, where customers have “full access to Copilot and AI agent features,” though an administrator can still switch an individual capability off. The other is hosting on a partner’s own infrastructure as an on-premises deployment, where “Copilot is not available.” Two providers can both call what they sell hosted Business Central and mean different things, which is the exact question worth asking before planning anything around AI and agentic capabilities.
Tigunia’s Business Central solutions and services are outlined at https://tigunia.com/solutions/microsoft-business-central/. Organizations weighing a move from an older Dynamics NAV version can find Tigunia’s upgrade guidance at https://tigunia.com/services/nav-to-business-central-upgrade/.
About Tigunia
Tigunia is a Microsoft Solutions Partner with offices in Phoenix, Arizona; Milwaukee, Wisconsin; and Edmond, Oklahoma. The company implements, upgrades, and supports Microsoft Dynamics 365 Business Central (previously Dynamics NAV) for mid-market organizations across accounting and professional services, distribution and warehousing, nonprofit, field services, manufacturing, retail and ecommerce, and transportation. Services include implementation, project rescue, upgrades from NAV, earlier Business Central on-premises versions, and Sage, custom development, training, and ongoing support.
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