2026 Release Wave 1(28.0) Major Update in Business Central That Actually Help Clients

This release is not about “new screens.” It’s about running the business with fewer surprises and more confidence.

1. Smarter Work with Copilot & AI Agents (Without Losing Control)

What changed functionally

AI is now embedded into everyday work, but users stay in control:

• See which vendor emails were already processed by the Payables Agent
• Review AI‑generated content directly on the page
• One task pane shows everything AI is doing
• Users can stop AI tasks anytime
• Item pages show smart insights (KPIs, summaries)

Client scenario

Accounts Payable team

• Vendor sends invoice by email
• Payables Agent creates a draft invoice
• Email is marked “Processed”
• AP user reviews, edits if needed and posts

Faster invoice processing
No duplicate work
Still human‑approved (audit‑safe)

2. External Storage for Attachments (Clean & Scalable)

What changed functionally

Document attachments (invoices, delivery notes, contracts) can be stored externally instead of bloating Business Central.

Client scenario

Trading company

• Uploads thousands of invoice PDFs every month
• System stays fast
• Documents still accessible from transactions

Better performance
Easier document management
Ideal for high‑volume businesses

3. Quality Management (BIGGEST Functional Addition)

Yes – Quality Management is included 

What changed

Business Central now supports native quality checks for:

• Purchase receipts
• Production output
• Assembly output

You can:

• Inspect items by lot/serial
• Test only samples (percentage or quantity)
• Block or quarantine failed items
• Generate quality reports/certificates

Client scenario

Manufacturing company

• Raw material received
• Quality check triggered automatically
• Sample fails dimensions test
• Batch is quarantined and cannot be used in production

Prevents bad material reaching production
No Excel or custom QC add‑ons
Strong compliance & operational control

4. Stronger Approvals for Supply Chain Activities

What changed

Approvals now apply to:

• Item journals
• Requisition worksheets
• Inventory and consumption postings

Once approval is requested:

• Lines cannot be edited or deleted

Client scenario

Warehouse & production team

• Stores enters material consumption
• Production head approves
• Quantities can’t be quietly changed later

Prevents misuse
Better internal control
Audit‑friendly operations

5. Better Inventory, Variants & Product Handling

What changed

• Item attributes at variant level
• Images for item variants
• Better planning behavior for items without SKUs
• Description 2 field available on more pages

Client scenario

Furniture retailer

• Same chair in 5 colors
• Each variant has its own image & attributes
• Shopify sync becomes accurate

Cleaner item master
Better ecommerce and reporting accuracy

6. Improved Drop Shipment & Purchasing Scenarios

What changed

• Create purchase orders directly from Sales order that are setup as a drop shipment.
• Post purchase invoices independently
• Reverse drop shipments when needed
• Match invoices to multiple receipts/orders
• New action group "Drop Shipment" available in planning worksheet to get sales orders.

Client scenario

Trading company

• Customer order and then supplier ships directly
• Vendor invoice arrives later
• Finance posts purchase invoice without waiting for sales invoice

Smooth drop-ship accounting
Fewer workarounds
Cleaner reconciliation

7. Shopify Integration That Feels Complete

What changed

• Product variants sync with images
• Product options based on item attributes
• Correct checkout currency flows into BC
• Shopify connector kept current automatically

Client scenario

Ecommerce business

• Customer orders in AED
• Sales order created in AED
• No currency confusion or manual correction

Better customer experience
Less finance rework

8. Electronic Documents & Vendor Automation

What changed

• Inbound e‑documents can link directly to purchase invoices
• Default e‑document types on vendor templates
• Supports service invoices (Germany - preview)

Client scenario

AP team

• Vendor sends structured e‑invoice
• System matches it to PO & receipt
• User just reviews and posts

Faster AP cycle
Fewer posting errors

9. Finance‑Focused Improvements (Preview but Important)

What’s coming

• Vendor withholding tax calculation 
• Self‑billed invoices - Buyers can now generate invoices on behalf of a vendor when a self‑billing agreement is in place
• Plastic & sugar tax (for applicable countries)

Following pages to be setup when configuring withholding tax

Client scenario

Compliance‑driven country

• Tax is deducted automatically at invoice posting
• Correct liability posted without manual journals

Stronger compliance
Reduced manual corrections

10. Reporting, Analytics & Audit Readiness

What changed

• Control report layout lifecycle
• Modern inventory analytics
• Better financial reports
• APIs to analyze approvals & permissions (for auditors)

Client scenario

Finance controller

• Locks approved report layouts
• Users can’t upload random formats
• Audit reports are consistent every month

Governance without customization
Auditor confidence

11. Sustainability (Growing but Practical)

What changed

• Carbon footprint shown on documents
• APIs for sustainability integration
• E‑invoicing formats support footprint data

Client scenario

Sustainability‑aware business

• Sales invoice shows carbon impact 
• Reporting supports ESG initiatives

Future‑ready
Regulatory aligned

Final Client‑Level Takeaway

Business Central v28 helps clients:

• Control quality before problems occur
• Approve critical transactions properly
• Reduce manual finance work
• Run ecommerce & supply chain smoothly
• Stay audit‑ready by design

 

UAE E‑Invoicing 🚩 - The Silent Red Flag Risks You Shouldn’t Ignore

You won’t get a call immediately ...

You won’t see an officer at your door ...
But your business can quietly enter the FTA Compliance Radar if e‑Invoicing is ignored. 

Once you miss timelines, your name doesn’t shout.
It automatically appears in the Government’s digital monitoring system.
That’s where penalties start ticking silently

Let’s break down the “scary‑but-real” violations.

1. “Non‑Onboarded Entity” Alert

(Not implementing e‑Invoicing on time)

What triggers the alarm?

If you don’t activate the e‑Invoicing system or don’t appoint an accredited service provider within the official timeline.

Example:

You’re still sending:

• PDF invoices
• Excel invoices
• Manual invoices

while e‑Invoicing is already required.

What happens?

Your business quietly enters the “Non‑Compliant Registry” penalties start every month.

Penalty:

AED 5,000 per month (or part of a month)

Even 1 day late = counts as a full month.

2. “Missing Digital Trail” Trigger

(Invoice not issued electronically)

What goes wrong?

You issued an invoice but not through the official e‑Invoicing system.

Example:

Goods delivered today, but:

• Invoice sent by email
• Or invoice uploaded late into the system

Why this is risky?

FTA systems expect real‑time electronic traces. Missing them = automatic mismatch.

Penalty:

AED 100 per invoice
Max AED 5,000 per month

Too many mismatches = deeper review.

3. “Invisible Credit Note” Warning

(Credit notes issued outside the system)

What’s the issue?

Discounts, returns, corrections… but the credit note is manual, not electronic.

Example:

1. Customer returns items  

2. accounts adjusted internally 

3. no electronic credit note issued.

Why scary?

Adjusting VAT without a formal e‑trail looks like data manipulation to the system.

Penalty:

AED 100 per credit note
Max AED 5,000 per month

4. “System Down but Silence” Flag

(Issuer didn’t report system failure)

What happened?

Your system or provider was down, but you didn’t inform the FTA.

Example:

• E‑Invoicing portal not working
• ERP integration failed
• Invoices issued manually
  No official notification sent

Why dangerous?

FTA allows failures but not silence.

Penalty:

AED 1,000 per day of delay

The clock ticks daily until reporting is done.

5. “Passive Recipient” Risk

(Buyer didn’t report failure)

Yes, buyers are watched too

If you cannot receive electronic invoices and don’t inform the Authority,

IT'S A VIOLATION

Example:

Your system can’t receive invoices, but:

• You accept offline invoices
• You stay quiet

Penalty:

AED 1,000 per day

Being passive is not compliance.

6. “Outdated Identity” Signal

(Business data not updated)

What’s wrong?

Your business details changed, but not updated with your accredited service provider.

Example:

• Trade name changed
• VAT details updated
• Address or contact changed
  Service provider not informed

Why this matters?

Data mismatch = trust issue in government systems.

Penalty:

AED 1,000 per day

Old data? then continuous penalty bleeding.

One reassuring note:

If you’re using e‑Invoicing voluntarily (before mandatory phase) - these penalties do NOT apply.

In short,

No system means You’re visible
Late upload means You’re traceable
No notification means You’re exposed
Wrong data means You keep paying daily

Official documentation for your reference: Cabinet-Decision-Violations-and-Penalties-eInvoicing-final-version-en-8.12.25.pdf

Importing 100,000+ Records & Multiple Journal Batches in Business Central? - Will it Really Work?

Uploading large volumes of data and working with multiple batches (such as General Journal batches) are common tasks during implementations and month‑end processes.

We often receive two frequent questions from clients everywhere:

1. Can we upload more than 100,000 records?
2. Can we import two or more different batches in the General Journal at the same time without locking?

According to Microsoft’s official documentation, Business Central recommends importing up to 25,000 records for smooth performance. But what if you have 100,000 records?
You might feel stuck. You want the process to be quick and seamless.
You wonder: “Is there any workaround? Is it possible at all?”

The answer is YES. Both are fully supported.

Below is a simple explanation with practical examples.

 

1. Uploading More Than 100,000 Records Using Configuration Package

Business Central can easily import 1 lakh+ rows through RapidStart / configuration packages if the data is prepared efficiently.

Tip: Select Only Required Fields for Faster Import

Most tables in Business Central contain 40-50 fields, but during Excel imports you usually need only 8-12 fields.

If you include only the required fields (with validation enabled), the import becomes significantly faster.

Why does this help?

• Fewer fields to validate
• Smaller Excel file
• Lower memory usage
• Faster commit cycles
• Reduced chances of timeouts

 

Example: Importing 100,000+ General Journal Lines

Assume a company wants to upload 120,000 General Journal lines for opening balances, recurring entries, and adjustments.

Instead of selecting all fields from the “Journal Line” table, you include only the following required fields:

Required Fields Used for Import (Example)

• Journal Template Name
• Journal Batch Name
• Line No.
• Account Type
• Account No.
• Posting Date
• Document No.
• Description
• Bal. Account No.
• Currency Code
• Amount
• Shortcut Dimension 1 Code
• Shortcut Dimension 2 Code

Sample Excel Structure

Journal Template Name

Journal Batch Name

Line No.

Account Type

Account No.

Posting Date

Document No.

Description

Bal. Account No.

Currency Code

Amount

Shortcut Dimension 1 Code

Shortcut Dimension 2 Code

GENERAL

PAYMENTS

10000

G/L Account

40100

01‑01‑2026

JV‑0001

Vendor Payment

10100

USD

1500

DEPT‑FIN

PROD‑01

GENERAL

PAYMENTS

20000

Vendor

V00045

01‑01‑2026

JV‑0001

Vendor Settlement

10100

USD

-1500

DEPT‑FIN

PROD‑01

GENERAL

ACCRUALS

10000

G/L Account

60200

31‑01‑2026

ACC‑001

Salary Accrual

99999

USD

25000

HR‑01

DIV‑01

GENERAL

ACCRUALS

20000

G/L Account

99999

31‑01‑2026

ACC‑001

Accrual Offset

60200

USD

-25000

HR‑01

DIV‑01

This structure is fully sufficient for importing 120,000+ lines and the import is fast because only essential fields are selected.

2. Importing Multiple Journal Batches Together (Without Locking)

You can upload multiple batches such as PAYMENTS, ACCRUALS, ADJUSTMENTS in the same Excel file or via separate uploads in different batches.

Important: No Locking Occurs

Business Central does not lock the General Journal when:

• Multiple batches are imported in a single file
• Multiple users are working in different batches
• Configuration packages insert lines into multiple batches

Each batch behaves as an independent container.

Scenario: Uploading Two Batches at Month-End

Your file contains:

• 60,000 rows in the PAYMENTS batch
• 60,000 rows in the ACCRUALS batch

Whether you upload them in:

• A single file, or
• Two parallel uploads (two different tabs)

…there will be no system locking.

Results:

• PAYMENTS batch gets all vendor and bank-related entries
• ACCRUALS batch gets all month-end adjustments
• Both batches remain separate and ready for posting
• Users can continue editing entries in parallel

Summary,

• Business Central can import more than 1 lakh records using configuration packages but with good structuring of an excel upload.
• Always select only required fields to speed up processing.
• You can import multiple General Journal batches in one Excel file or in parallel.
• No locking occurs because each batch is independent.
• These methods are ideal for implementations, data migration, and month-end postings.

Understanding Business Central Tenant Capacity and Extra Environments

When your company uses Microsoft Dynamics 365 Business Central, your data grows over time, just like a warehouse that fills up with more boxes as your business expands. 

To help you understand how much “digital space” you are using, Business Central provides two important features in the Admin Center:

1. Tenant Capacity
2. Environments (Production and Sandbox)

Business Central Tenant Capacity 

Think of Tenant Capacity as the storage dashboard for your Business Central system. Just like a warehouse needs enough space to store goods, your Business Central tenant needs enough capacity to store the data your business produces each day.

Scenario

Your company has been using Business Central for a few years. Every day, users create:

• Sales orders
• Purchase documents
• Posted invoices
• Ledger entries
• Attachments such as PDFs and images

All this information takes up space, and as the business grows, so does the storage usage.

Tenant Capacity helps you answer important questions:

• How much storage have we used?
• What is occupying most of the space?
• Are we nearing our limit?
• Should we clean up old data or buy more storage?

What You See on the Tenant Capacity Page

1. Total Storage Available

This is the total storage Microsoft includes with your Business Central subscription. Think of it as knowing the total size of your warehouse.

2. Storage Used

Shows how much of your total capacity is already consumed. This number grows as your business activity increases.

3. Breakdown by Storage Type

You can see exactly what is taking up space, such as:

• Database tables
• Logs
• Attachments and files
• Each environment (Production and Sandbox)

This is like knowing which items, old boxes, new stock, damaged pallets are filling your warehouse.

4. Options to Increase Storage

If you are running out of space, the page also shows how you can purchase more capacity.
This is similar to renting additional warehouse space.

 

Why Tenant Capacity Matters

1. Prevent Performance Issues

Large databases can slow down the system. Monitoring usage helps avoid surprises.

2. Clean Up Unused Data

You can identify and remove:

• Old logs
• Unnecessary attachments
• Outdated archived data
• Historical entries no longer needed
• Cleaning up reduces storage usage and cost.

3. Better Budget Planning

If your company is growing quickly, you’ll know in advance when you may need more capacity.

4. Clear Environment-Level Visibility

Each environment shows its storage usage so you can monitor which areas are consuming the most space.

A Simple Example

Suppose your company has 80 GB of total available capacity.

You check the Tenant Capacity page and see:

• 65 GB used
• 15 GB remaining
• 40 GB from posted documents
• 20 GB from attachments
• 5 GB from sandbox environments

Based on this, you may decide to:

• Archive older posted documents
• Delete unnecessary sandboxes
• Remove large attachments
• Buy additional storage
• Apply data retention policies

Customers can choose additional database and capacity based on their requirements.

It is available as 1 GB, 100 GB or additional environment add-on.

Understanding Extra Environments in Business Central

Just like having separate workspaces in a company main office, training rooms, and testing areas, Business Central provides different types of environments.

Types of Environments

• Production environment: Your live system with real data
• Sandbox environment: A safe testing space where changes don’t affect the live system

 

Default Setup

A Business Central tenant starts with:

• 1 Production environment
• 3 Sandbox environments
• Base storage capacity (80 GB)

This is enough for many businesses initially.

 

When You Need More Environments

As your business grows, you may need:

• More testing areas
• Multiple teams working on different projects
• UAT environments
• Training systems
• Region-specific setups
• Development environments

This is where extra environments become valuable. You can purchase this as an add-on.

 

Buying Additional Production Environments

Microsoft allows you to purchase extra production environments through your CSP partner.
Each extra production environment includes:

• 1 additional Production environment
• 3 Sandbox environments
• 4 GB of extra storage

Example

If you buy 2 additional production environments, you now have:

• 3 Production environments total
• 9 Sandbox environments
• 8 GB additional storage

This is ideal for organizations with multiple regions, departments, or teams.

 

Environments Can Be Created in Any Supported Country

You can create environments in any country where Business Central is available.

This is useful for:

• Multinational companies
• Local tax or regulatory compliance
• Better performance for regional teams

Example:
Your headquarters is in Dubai, but you operate in India, Saudi Arabia, and the UK.
You can create environments in each of those regions.

 

Who Can Create Environments?

Anyone with the right permissions can create them:

• Customers
• Administrators
• Partner consultants

Environments can be created directly from the Business Central Admin Center—no need to contact Microsoft support.

 

Summary:

Your company starts with:

• 1 Production
• 3 Sandboxes
• 80 GB storage

Your operations expand, so you purchase 1 extra production environment. 
Now you have:

• 2 Production environments
• 6 Sandboxes
• 84 GB total storage (shared storage capacity for all the environments increases by 4 GB when you buy extra production environment)

And you can place each environment in any Business Central-supported region.

 

To conclude,

Tenant Capacity tells you how much storage your Business Central system is using, while extra environments give your company flexibility to test, train, and grow without affecting live business data.

Time to Upgrade: Move Your Business Central Emails to OAuth 2.0 Before March 2026

Introduction

Microsoft is retiring SMTP Basic Authentication on March 1, 2026. If your Business Central environment still uses the old username/password method for sending emails, it’s time to act. Switching to OAuth 2.0 (Modern Authentication) will keep your system secure, compliant, and ready for the future.

This guide explains why this change matters and how you can make the transition smoothly.

 

Why Switch to OAuth 2.0?

Microsoft is pushing this upgrade because:

• Basic Auth is outdated, and risky - passwords can be hacked easily.
• OAuth 2.0 is more secure - uses tokens instead of passwords.
• Supports MFA, conditional access, and better compliance.
• Works perfectly with Business Central’s modern email framework.

After March 1, 2026, Basic Auth will stop working completely.

 

How to Migrate in Simple Steps

1. Check Your Current Setup

If you’re using SMTP with username/password (smtp.office365.com), you need to migrate.

 

2. Use Business Central’s Modern Email Accounts

• Go to Tell Me - Email Accounts
• Click New - Microsoft 365
• Sign in using OAuth and approve permissions
• Set this as your default email account

 

3. (Optional) Register an Azure AD App

Needed only for advanced scenarios like custom integrations.

• Register app in Azure
• Add permissions: SMTP.Send, offline_access, email, openid, profile
• Add redirect URI: https://businesscentral.dynamics.com/oauth/redirect
• Grant admin consent

 

4. Update Business Central Settings

• Disable old SMTP setup
• Update workflows, report selections, and job queues
• Replace SMTP references in custom AL code with modern email APIs

 

5. Test Everything

Send test emails, check invoices, approvals, and job queues.

 

6. Remove Old SMTP Configurations

Delete credentials and server entries to avoid fallback.

 

Benefits of OAuth 2.0

• Stronger security
• No stored passwords
• MFA and conditional access support
• Microsoft-recommended best practice

Future-ready and compliant

 

Deadline Reminder

March 1, 2026 - After this date, SMTP Basic Auth will stop working. Migrate now to avoid email failures.

 

References & Credit

Exchange Online to retire Basic auth for Client Submission (SMTP AUTH) | Microsoft Community Hub

(Original content inspired by https://dynamicsdecoded.wordpress.com/2025/12/10/secure-your-business-central-emails-migrate-to-oauth-2-0/)

 

Sales Return Order vs Sales Credit Memo in Business Central: Key Differences and GL Impact

When handling customer returns or financial corrections in Microsoft Dynamics 365 Business Central, two documents often come into play: Sales Return Order and Sales Credit Memo. While they may seem similar, their purpose and operational flow differ significantly. Let’s break it down.

 

Comparison at a Glance

Feature	Sales Return Order	Sales Credit Memo
Primary Purpose	Handle physical returns of goods	Handle financial corrections (can include inventory if item lines are used)
Inventory Impact	Yes - inventory increases when goods are received	Yes, if item lines are included; No if only G/L or Charge lines
Warehouse Integration	Yes - supports Return Receipts, warehouse docs	No – skips warehouse steps
Return Reason Codes	Supported	Not supported
Link to Original Sales Order	Yes - can copy from original order	Yes - can apply to posted invoice
Posting Effect	·       Debit Inventory ·       Credit COGS ·       Credit Customer	·       Debit Inventory (if item lines) ·       Credit COGS ·       Credit Customer
Best Use Case	Customer sends goods back physically	Price correction, discount adjustment, or quick reversal without warehouse handling
Complexity	Higher - involves logistics and warehouse	Lower - direct posting
Audit & Traceability	High - structured process	Limited - no return reason or warehouse trace

• Sales Return Order = Full return process with warehouse and logistics.
• Sales Credit Memo = Quick reversal; can affect inventory if item lines are used.
• For financial-only adjustments, use G/L Account lines in Credit Memo (no inventory impact).

 

How General Ledger (GL) Accounts Are Affected

Both documents impact GL differently depending on whether inventory is involved:

Sales Return Order Posting

• Debit Inventory (stock increases)
• Credit COGS (reverse cost of goods sold)
• Credit Customer (reduce receivable)

Sales Credit Memo Posting

• If item lines:

§  Same as above: Debit Inventory, Credit COGS, Credit Customer

• If G/L Account lines only:

§  Debit Revenue Adjustment Account

§  Credit Customer

§  No inventory or COGS impact

 

Business Scenarios

Scenario 1: Physical Return of Goods

Customer returns 10 chairs worth $500 each.

• Document: Sales Return Order
• GL Impact:
• Debit Inventory: $5,000
• Credit COGS: $3,500 (assuming cost)
• Credit Customer: $5,000

Scenario 2: Price Correction

Invoice posted at $1,000, should be $900.

• Document: Sales Credit Memo (G/L Account line)
• GL Impact:
• Debit Revenue Adjustment: $100
• Credit Customer: $100
• No inventory impact

Scenario 3: Quick Reversal with Inventory

Customer cancels order after shipment but before payment.

• Document: Sales Credit Memo (Item lines)
• GL Impact:
• Debit Inventory: Item cost
• Credit COGS: Item cost
• Credit Customer: Sales amount

 

So, in general,

• Use Sales Return Order for structured returns involving warehouse.
• Use Sales Credit Memo for quick financial adjustments or when warehouse steps are unnecessary.
• Always define Return Reason Codes for better audit trails in return orders.