Dynamics GP vs Dynamics 365 Business Central

Both Dynamics GP and Dynamics 365 Business Central are ERPs aimed at small and medium-sized businesses, and are well-suited for managing an organization’s core finances. But there are some key differences that business leaders should be aware of when it comes to licensing, hosting, upgrades/updates, functionality, and AI capabilities.

I’ve been working with clients on GP for over 25 years. Since the release of Business Central, I’ve been having conversations with GP customers to help them compare their current solution to the Dynamics 365 alternative or transition when they are ready.

In this article, I’ve included an overview of each solution, a comparison table, and reasons why some GP clients are transitioning to Business Central.

• Comparison Table
• Overview of Dynamics GP
• Is Dynamics GP Support Ending?
• Overview of Dynamics 365 Business Central
• Connected Microsoft Technologies and Ecosystem
• Which ERP Solution Is Best for You?
• Is It Time to Transition from GP to D365 Business Central?

GP vs Business Central Comparison

The key difference between Microsoft Dynamics GP and Microsoft Dynamics 365 Business Central is that GP was built to be on-premise and Business Central was designed for the cloud. However, there is some overlap and a lot more detail to understand.

Let’s start with a quick table comparing them:

Product/Feature	Dynamics GP	Dynamics 365 Business Central
Hosting	On-premise or IaaS (not included).	Cloud (included). There is also an on-premise option.
Licensing Price	Perpetual licensing starts from $5,000 USD for 3 users ($6,167 CAD). Subscription licensing starts from $65 USD/user/month ($71.25 CAD).	Licensing starts at $80 USD/user/month ($108.50 CAD).
Upgrades/Updates	October 2019 (18.2) release and later — free service pack updates. Earlier GP versions — manual upgrades.	Free and automated updates.
Add-on Options	Large pool of add-ons.	Large and rapidly growing pool of apps.
Power BI Integration	Yes – some effort.	Yes – little effort.
Budgeting	Setup and import Excel-based budgets. Advanced capabilities through ISVs.	Create multiple budgets for financials, revisions, analysis, and dimensional reporting.
US & Canadian Payroll	Yes.	Yes — through apps.
Dynamics 365 Sales/CRM Integration	Yes — significant effort.	Yes — little effort.
Financial Reporting	Management Reporter and Jet Reports.	Leverages account schedules and analysis views. Can also use Jet Reports.
GL Account Structure	Multiple segments for structure.	Dimensional chart of accounts.
Purchase Orders	Requisitions, PO creation, separate inventory receipt, and 3-way PO invoice matching.	PO creation, separate inventory receipt, and 3-way PO invoice matching. Does not have requisitions.
AI Capability	No	Built-in generative AI with Microsoft Copilot.

Dynamics GP and Dynamics 365 Business Central are quite similar in terms of functionality. Both offer budgeting, reporting, ways to segment the general ledger account structure, and support for fixed asset management and eBanking.

GP and Business Central provide similar functionality for:

• Bill of Materials
• eBanking
• Fixed Assets
• Intercompany Processing
• Inventory Tracking
• Sales Order Processing
• Project Accounting (now called Jobs)
• Manufacturing
• Multiple Currencies
• Multiple Entities
• SQL Server Reporting Services

However, one of the most important differences in functionality is Business Central’s dimensional accounting. Dimensions in Dynamics 365 Business Central let you define analysis categories and then “tag” your data so you can quickly review, for instance, travel expenses across several different departments. For more comparisons between Dynamics GP and Dynamics 365 Business Central, please visit our Functionality Similarities and Differences article.

You can also review more detailed information, timelines, and actions for moving from Dynamics GP to Dynamics 365 Business Central in our new guide.

Microsoft Dynamics GP Overview

With Microsoft Dynamics GP, there are options in both licensing and hosting:

GP Licensing Options

• Perpetual licensing — you own your licensing.
• Subscription licensing — you have the flexibility of paying monthly.

With perpetual licensing, you pay the full licensing costs upfront. You also pay an annual maintenance fee to Microsoft after that. Subscription licensing avoids that large initial capital expense and the annual maintenance fee.

Please note that Microsoft stated there will be no new sales of GP effective April 1, 2026, but this does not impact existing customers. Existing GP customers can continue to purchase new licenses and modules.

GP Hosting Options

• On-premise — you maintain your own servers.
• Cloud hosting — your servers are hosted through Infrastructure as a Service (Iaas), either through a private cloud or Microsoft Azure.

With perpetual licensing, you pay the full licensing costs upfront, starting from $5,000 USD for 3 users (or $6,167 CAD). You also pay an annual maintenance fee to Microsoft after that. As of October 1, 2023, customers will typically pay 20% the first year and 18% after that. Subscription licensing avoids that large initial capital expense and the annual maintenance fee.

With cloud hosting, you save the cost and risk of upgrading your servers every 2–3 years. Cloud hosting also provides superior security and easier remote work options. Your Dynamics Partner may also offer additional cloud perks such as 24-hour monitoring, weekly server updates, break-fix support, and automatic backups.

GP Packs and Add-Ons

You can extend the functionality of Dynamics GP through 2 additional “packs” from Microsoft and a very deep pool of ISV add-ons that has built up over the years. However, Dynamics 365 Business Central has also added a lot of ways to extend its functionality since it was released in 2018.

For instance, you may have heard that one of the biggest functions that GP has that Business Central does not have out of the box is payroll.

However, there are now several third-party payroll apps available. We recommend different solutions and help our clients implement them depending on their specific payroll needs.

Is Microsoft Dynamics GP Support Ending?

Yes, Microsoft announced a retirement date of September 30, 2029, for all versions of Dynamics GP, which means that Microsoft will not have product support or updates for Dynamics GP after that date, except for security patches ending April 30. 2031. For more information about this announcement, please see our Retirement of Dynamics GP article.

With the October 2019 release, Dynamics GP follows the Modern Lifecycle Policy, which is different from the Fixed Lifecycle Policy. The Modern Lifecycle Policy offers support and servicing, including bug fixes, new features, and tax updates, throughout the year. While on GP, it’s important to stay current, for reasons like Microsoft support, compatibility with other business technologies, compliance with regulations, and the features and quality improvements in the latest build.

To stay current, you must be on one of that year’s releases to be eligible to update to the next year’s releases. Our “Top Questions about Dynamics GP Versions” article has sections with more information about the Modern Lifecycle Policy and which versions of GP are on the Fixed vs Modern Policy.

Microsoft Dynamics 365 Business Central Overview

Dynamics 365 Business Central is a financial management software product from Microsoft. It is built for the same target market as GP.

The biggest thing to know is that Business Central was built for the cloud. As such, it is usually licensed on a full “SaaS” model (Software as a Service). You pay monthly subscription licensing and your ERP is hosted in the Azure Cloud. The benefit here is that Microsoft automatically pushes out enhancements, bug-fixes, and updates for your solution — no more upgrades! There is also no up-front cost for hardware, servers, or other components, which is great for companies with little or no dedicated IT resources. For more details on what makes a cloud upgrade in Dynamics 365 different than one with on-premise servers, see our ‘How are Upgrades Different in Dynamics 365?’ blog article.

For companies that need it, there is also an option to have Business Central on-premise. However, the data security is not as strong, and you do have to pay for servers, etc.

Business Central Licensing and Apps

With Dynamics 365 Business Central, you can choose whether to license your users with essential or premium functionality. (All your users must be the same type.) There are also Team licenses that allow for read-only access and limited write permissions. The flexibility in subscription pricing allows for the scalability of adding users as your business grows. See our Dynamics 365 Business Central Licensing and Pricing post for more information.

For 3^rd-party or ISV solutions, Business Central has “apps.” From the user’s perspective, Business Central 3rd-party apps and GP add-ons are roughly equivalent. There is an active ISV community that creates these apps for Business Central, similar to what you are used to in GP. Your Dynamics partner should help you consider which apps will best suit your business needs and technical situation.

Built-In Generative AI

Users can enhance productivity and improve business processes using built-in generative AI technology like Copilot with Dynamics 365 Business Central. These built-in capabilities empower businesses to make data-driven decisions instantly, optimize their processes, and save time on daily tasks. Companies can protect data privacy and ensure compliance using Microsoft’s governance tools for responsible AI use.

Explore Microsoft Copilot functionality in Dynamics 365 Business Central in our ‘New Features for Copilot in Dynamics 365 Business Central’ article and video.

Connected Microsoft Technologies and Ecosystem

There are many business benefits of the Microsoft ecosystem and the interconnected technology available through the Microsoft platform.

Dynamics 365 Business Central seamlessly integrates into the Microsoft ecosystem, including Office 365, Teams, Power BI, Power Platform, and Dynamics 365 CRM. These integrations create a unified and consistent user experience, enhancing productivity and collaboration while enabling advanced analytics.

It is important to evaluate your ERP solution beyond only features and functions and review it as an entire solution that can connect with other aspects of your business.

Dynamics GP or D365 Business Central: Which ERP Solution Is Best for You?

If you are evaluating the two ERP solutions to implement brand new today, Encore recommends selecting Dynamics 365 Business Central. While Dynamics GP is a trusted ERP solution, with Microsoft’s announcement about its retirement, we do not recommend implementing GP new today. As a trusted Microsoft Dynamics Partner, Encore is here to help you navigate this important decision. Our team will provide tailored advice that aligns with your unique business needs.

If you’re currently using Dynamics GP, every customer needs to evaluate their options and decide which option is best for them in the short and long term for their business. We are experts in both Dynamics GP and Dynamics 365 Business Central and have teams dedicated to each product with a deep history and experience. Encore is here to support the success of customers like you as you navigate your technology.

If you would like more information or have any questions about what ERP solution is right for you, please contact us. If you are an Encore customer, please reach out to your Account Manager.

Time to Transition from Dynamics GP to Dynamics 365 Business Central?

Many current Dynamics GP customers are switching from GP to Business Central. There is an easy learning curve for users because Business Central’s interface is consistent with all Microsoft products.

Moving from Dynamics GP to Dynamics 365 Business Central might be the right decision for your business if you want to:

• Transition your business systems to the cloud.
• Empower your remote and mobile workforce to be more productive and collaborative.
• Benefit from modern security and disaster recovery, with your data stored in highly secure, state-of-the-art data centers managed by Microsoft.
• Save on expenses for server maintenance and replacement.
• Have more predictable and flexible ERP costs (based on user licenses per month).
• Always be on the latest version of the solution, removing the need for future upgrades.
• Experience faster and more flexible analysis of all your data.
• Enjoy seamless integrations with other Microsoft business products, such as invoicing from Outlook, streamlining business processes with Power Automate, and more.

If you are concerned about ISV solutions you currently use in Dynamics GP, there is likely an equivalent 3^rd-party Dynamics 365 app available, or the functionality is available out of the box in Business Central. Read our article about what happens to your Dynamics GP add-on solutions when you move to D365 BC, or Encore can help assess your 3^rd-party apps.

If you’d like to see some functionality comparisons between Dynamics GP and Dynamics 365 Business Central, please see the following YouTube playlists:

• Microsoft’s Move from Dynamics GP to Business Central playlist
• Encore’s Dynamics GP to Dynamics 365 Business Central playlist

If you have a question about a specific function being available in Dynamics 365 Business Central, please reach out to us.

Transition Offers and Promotions

Different offers and promotions are available for customers looking to transition to Dynamics 365 Business Central. Below are some short summaries and links to learn more.

Business Central Migration Assessment (formerly AIM Assessment) is a complimentary assessment that provides a baseline technical and functional overview with high-level guidance for moving from your on-premise solution to the cloud.

Bridge to the Cloud 2 Promotion is a multi-year path that can help you transition from your on-premises deployment to Dynamics 365 Business Central. This promotion includes discounted licenses and dual-access rights for your existing on-premises ERP and your new cloud ERP.

Business Central Deployment Offer: by working with Encore, there is up to a $4,500 credit against services that are available.

Encore’s Accelerator Program is suitable for SMBs who wish to move to D365 Business Central with a streamlined process. This includes companies currently on QuickBooks, NetSuite, Sage, and other non-Microsoft ERPs. This may be a good fit for you if you are a small Dynamics GP client with basic requirements. Please contact your Encore Account Manager to discuss if this program is right for you.

Encore has helped many of our Dynamics GP customers transition to Dynamics 365 Business Central. If you’re interested in transitioning to Dynamics 365 Business Central, please contact us or review our Dynamics GP to Dynamics 365 Business Central Transition page.