Differences between a budget and a spending limit in Azure

If you have created a free account with Azure, you likely received free credit for the first month.

With this credit, you may notice that a spending limit has been put in place to ensure that the expenditure cannot exceed the credit.

Then, isn't a spending limit the same as a budget? Can the two terms be used interchangeably?

Not quite. There are some differences:

Spending limits

  • When a spending limit is reached, the services that you deployed are disabled for the rest of the billing period.
  • Any virtual machines are stopped and de-allocated.
  • Data in storage accounts is available as read-only.
  • Resources would not be deleted, but will need to be re-deployed when the spending limit is increased, or you move into a new billing period.
  • You can only have one spending limit.
  • Spending limits apply to the subscription.


  • When a budget is reached, the services do not automatically stop.
  • Multiple budgets can be set.
  • Alerts can be set up to notify you when the service cost approaches, exceeds, or has reached the budget.
  • Budgets can be applied to different scopes.

Which should we use?

Budgets can, and should be used alongside spending limits.

If you have an expected expenditure on a resource (or set of resources), you can create a budget with that expected expenditure.

Then, you can create alerts that will let you know how much of your budget has already been spent, allowing you to make adjustments.

Alternatively, if there is a financial limit where you would rather stop the service your providing than continue to pay, then a spending limit should be used.