Office Says Unlicensed Product? How to Fix It

The title bar in Word or Excel says "Unlicensed Product", and a yellow or red banner reads "Product Deactivated", "Account notice", "We found a problem with your Microsoft 365 subscription" or "Most features of Word have been disabled because it hasn't been activated". You can open documents but not edit or save them. Other times you see "There are problems with your account. To fix them, please sign in again."

It usually happens at the worst moment, but the fix is normally quick once you know whether it's your sign-in, your licence or the PC's activation state.

Why This Happens

• Signed in with the wrong account, such as a personal Microsoft account, or not signed in at all.
• No suitable licence. Microsoft 365 Business Basic doesn't include desktop apps. Business Standard, Business Premium and Microsoft 365 Apps for business do.
• A licence was removed or changed, for example during a plan switch or when a subscription lapsed.
• The device limit was reached. Each user can activate Office on up to five PCs or Macs, five tablets and five phones.
• Conflicting Office versions, such as a preinstalled trial or old Office 2016 alongside Microsoft 365.
• Corrupted activation data, often after a PC is reimaged, renamed or passed to a new user.

Fix 1: Check Which Account Office Is Using

1. In Word or Excel, go to File > Account.
2. Under User Information, check it shows your work email. Under Product Information, it should say something like Subscription Product: Microsoft 365.
3. If the wrong account is shown, click Sign out, close all Office apps, reopen Word and sign in with your work account.
4. If there's an Activate Product or Fix me button, click it and sign in.

Fix 2: Check Your Licence

Sign in at office.com (or microsoft365.com). If you can't see an option to install Office apps, you probably don't have a desktop licence. In My Account (myaccount.microsoft.com), look for Subscriptions to see what's assigned to you.

For your Microsoft 365 admin

1. In the Microsoft 365 admin centre, go to Users > Active users and select the user.
2. Open Licences and apps. Confirm a licence that includes the desktop apps is assigned, and that Microsoft 365 Apps for business (or enterprise) is enabled under the apps list.
3. Check Billing > Your products to confirm the subscription is active and has enough licences.

Fix 3: Free Up an Installation Slot

If you've hit the limit of five PCs or Macs, sign out of Office on devices you no longer use. In My Account, look for the Office apps or Devices section, which lists where you're signed in and lets you sign out of old devices. After that, sign in again on the current PC.

Fix 4: Remove Conflicting Versions

Go to Settings > Apps > Installed apps and search for Office and Microsoft 365. If there's more than one version, such as Microsoft 365 - en-gb plus Office Home and Student 2016 or a trial, remove the ones you don't use. New PCs often come with a preinstalled Office trial that fights with your business licence.

Fix 5: Repair Office

In Settings > Apps > Installed apps, select Microsoft 365, choose Modify and run Quick Repair, then Online Repair if needed.

Fix 6: Reset the Activation State

If the PC was used by someone else, reimaged or has corrupted activation data, reset it so Office activates cleanly:

1. Close all Office apps.
2. Remove Office-related entries from Credential Manager > Windows Credentials, as described in our Outlook password guide.
3. Check Settings > Accounts > Access work or school for old accounts belonging to a previous user and disconnect them, if you're allowed to.
4. Microsoft publishes scripts for resetting Microsoft 365 Apps activation state (search for Microsoft's guidance on resetting Office activation, which includes OLicenseCleanup.vbs). Your IT team can run these as part of a clean reset.
5. Restart, open Word and sign in with your work account.

Shared Computers and Remote Desktops

On PCs used by several people, such as a reception desk, or on Remote Desktop and Azure Virtual Desktop servers, normal activation hits limits and signs one person in for everyone. Shared computer activation solves this by activating Office per user, with each user's own licence. It's supported with Microsoft 365 Apps for enterprise and Microsoft 365 Business Premium, and is configured during installation or by policy. If a shared PC keeps showing activation errors, ask your admin whether shared computer activation is set up.

For Your Microsoft 365 Admin

• Check the user's sign-in logs in Entra if activation sign-ins fail, as Conditional Access policies apply to Office activation too.
• Use Intune to deploy Microsoft 365 Apps consistently, remove preinstalled trials and old versions, and keep apps on a supported update channel.
• When moving users between plans, assign the new licence before removing the old one to avoid a reduced-functionality gap.

How to Stop It Happening Again

Activation errors are usually a symptom of untidy licence management: the wrong plan for the job, licences removed during changes, new PCs set up by hand, and leavers' devices passed on without resetting. A simple joiner, mover and leaver process with licences checked on each step, and devices set up through Intune with Autopilot, means Office just works on day one. Our Microsoft 365 setup guide covers choosing the right plans.

When to Call in Help

If several people see licence errors, you're not sure which plans you need, or devices are being reused between staff, our managed IT service takes care of licences and device setup, and our IT support team can fix individual issues remotely. A free IT health check can also spot licensing gaps. Get in touch.

Related Reading

• Microsoft 365 Setup Guide for Small Teams
• Outlook Keeps Asking for Password? How to Fix It
• Microsoft 365 Sign-In Errors Explained