Office 365 started out as being Microsoft's online service for businesses, to run email, communications and file sharing in the cloud, which also included licences for the desktop Office software, but it now includes all Microsoft's Office subscription services, for consumers as well as businesses.

You can pay monthly or yearly, you automatically get new features as they're released and the next version of Office when it comes out, and if you use the mobile version of Office on a device with a screen bigger than 10.1-inches (whether that's a Windows 10 desktop or an iPad Pro), you can edit documents as well as viewing them. You get cloud storage and other benefits, but if you stop paying your subscription, you stop being able to use Office.

Office 365 is ideal if you have multiple machines at work and at home, or if your family has several computers, or if you might want to switch between a Mac and a PC, because even the consumer subscriptions cover all of that.

Office 365 Personal and Office 365 Home give you the same software: the Windows or Mac versions of Word, Excel, PowerPoint, OneNote and Outlook, plus Publisher and Access for Window, along with 1TB of OneDrive space and monthly credits to make 60 minutes of calls on Skype.

The difference is that with the Personal subscription you can install the software on one PC or Mac and on one tablet and one phone, but Office 365 Home lets you put the same software on five Macs or PCs and on five tablets and phones – you can use all the installs yourself, or you can share them with family or friends (who each get 1TB of cloud storage space and Skype credits).

There are two Office 365 subscriptions for businesses with up to 300 users, and you can still pay for them month by month. Office 365 Business and Office 365 Business Premium both include Office 2016 – the Windows or Mac versions of Word, Excel, PowerPoint, OneNote, Outlook, and Publisher, and each person can put them on up to five PCs or Macs – the Office apps on five phones and tablets per user, and 1TB of OneDrive for Business storage. The difference is that the Business Premium subscription also has Exchange, SharePoint and Skype for Business Online.

Larger businesses will want the Office 365 enterprise plans, which include more security and information management tools, and which you have to pay for on a yearly basis. Again, the difference is which of the cloud services are included. Both include Office 2016 – the Windows or Mac versions of Word, Excel, PowerPoint, OneNote, Outlook, Publisher and Access, on up to five PCs or Macs per user, as well as the Office apps on five phones and tablets per user. Office 365 ProPlus has 1TB of OneDrive for Business storage per user; an Enterprise E3 tenant has all that, plus Exchange, SharePoint and Skype for Business Online.

There are also Office 365 subscriptions for business that only include the Exchange, SharePoint and Skype for Business Online services, but not Office 2016, for companies that already have Office licences, or who are happy using the Office Online web apps instead. These are Office 365 Business Essentials, for up to 300 users, and the E1 enterprise plan for larger companies.