Every version of Microsoft Dynamics AX is now out of support. The last one, AX 2012 R3, reached the end of extended support on January 10, 2023. If AX still runs your finance and operations, you’re carrying risk that grows every month: no security fixes, no regulatory updates, and a shrinking pool of people who know the system. The migration itself carries risk too. Get it wrong, and you go live with balances that don’t tie and users who don’t recognize their own data. This guide covers how to run a Dynamics AX to Dynamics 365 migration with that risk under control and draws on Microsoft’s official documentation as well as real-life experience we have accumulated from migrating companies’ data into Dynamics 365.
The short answer: If you’re on AX 2012 R2 or R3, Microsoft supports a direct upgrade through Lifecycle Services (LCS). If you’re on AX 2009, Microsoft’s Data Migration Tool is the only supported upgrade path for a Dynamics AX 2009 to Dynamics 365 migration. In either case, the project runs through assessment, code and data work, repeated testing, and a planned cutover. So, without further ado, here is what you need to know to successfully execute data migration from AX 2012 to Dynamics 365.
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- What Are the Main Steps Involved to Migrate from Dynamics AX to Dynamics 365 Finance?
- When to Migrate Dynamics AX to Dynamics 365 Finance
- What Are the Benefits of Moving AX to Dynamics 365 Finance & Supply Chain Management?
- The Dynamics AX to Dynamics 365 Migration Process
- Common Dynamics AX to Dynamics 365 Migration Challenges & Pitfalls
- How to Prepare for a Dynamics AX to Dynamics 365 Migration
- Do I Need to Buy Licenses for a Dynamics AX to Dynamics 365 Migration?
- How to Run a Dynamics AX to Dynamics 365 Migration
- How Much Does it Cost to Migrate AX to Dynamics 365 Finance?
- Dynamics AX to Dynamics 365 Transition Plan
- Get Top 1% Dynamics AX to Dynamics 365 Migration Services
- FAQ on Dynamics AX to Dynamics 365 Finance and Operations Migration
What Are the Main Steps Involved to Migrate from Dynamics AX to Dynamics 365 Finance?
Here are the primary steps you should follow when attempting to perform a Dynamics AX to D365 Finance F&O migration:
- Assess your AX environment. Inventory modules, customizations, ISV add-ons, integrations, reports, and data volume.
- Choose your path. That’s a direct upgrade (AX 2012 R2 or R3 only) or a reimplementation that migrates master data and open transactions.
- Handle code and customizations. Retire what Dynamics 365 now does natively, and convert the rest into extensions.
- Configure Dynamics 365. Set up legal entities, the chart of accounts, financial dimensions, security roles, and workflows.
- Prepare and migrate data. Clean it at the source, map it to the new structure, and load it in repeated test rounds.
- Test. Run conference room pilots, user acceptance testing, and mock cutovers in a sandbox.
- Cut over and support. Freeze AX, run the final migration, validate, and provide hypercare.
Related Article: Dynamics 365 Data Migration Guide [2027]
When to Migrate Dynamics AX to Dynamics 365 Finance
For most AX customers, the time is now. According to Microsoft Learn, support ended on these dates:
| Version | Extended support ended |
|---|---|
| Dynamics AX 2009 SP1 | April 12, 2022 |
| Dynamics AX 2012 | April 12, 2022 |
| Dynamics AX 2012 R2 | April 12, 2022 |
| Dynamics AX 2012 R3 | January 10, 2023 |
Beyond support, other signs you’ve waited too long for a Dynamics AX migration to Dynamcis 365 are:
- Infrastructure and specialist support for on-premises AX cost more every year.
- Customizations make even small changes risky and expensive.
- Finance relies on manual exports and spreadsheets for reporting.
- You’re adding users, legal entities, or acquisitions, and AX is slowing you down.
Related Article: How to Migrate Data to Dynamics 365 in 7 Steps [2027]
Is Dynamics AX the Same as Dynamics 365 Finance?
No. Dynamics 365 Finance is the cloud successor to Dynamics AX, not a new version of it. Much of the business logic will feel familiar, but the platform is different. Dynamics 365 runs as a service on Microsoft Azure, is updated continuously by Microsoft, uses a browser-based interface, and is licensed by subscription. AX was installed on your own servers, upgraded in major projects, and licensed perpetually.
Related Article: Navigating QuickBooks to Dynamics 365 Migration
What is the Difference Between AX 2012 and D365?
| Dynamics AX 2012 | Dynamics 365 Finance and Operations | |
|---|---|---|
| Hosting | On-premises or private servers | Microsoft Azure, managed by Microsoft |
| Support | Ended (R3: January 10, 2023) | Actively supported |
| Updates | Cumulative updates on your schedule | Continuous updates from Microsoft |
| Customization | Overlayering in MorphX/AOT | Extensions in Visual Studio |
| Interface | Windows client, Role Centers | Browser-based workspaces, global search |
| Analytics | Basic built-in reporting | Native Power BI and Power Platform integration |
| Licensing | Perpetual | Per-user subscription |
Related Case Study: Dynamics 365 Data Migration Case Study
What Are the Benefits of Moving AX to Dynamics 365 Finance & Supply Chain Management?
The benefits of an AX to Dynamics 365 F&SCM migration are as follows:
- Supported, secure software. Security and regulatory updates come from Microsoft again.
- No more major upgrade projects. Continuous updates keep you current.
- Less infrastructure. Microsoft runs the platform on Azure.
- Real-time visibility. Native Power BI and Microsoft 365 integration replace static reports and manual exports.
- AI built in. Copilot and Microsoft’s finance agents aren’t available in AX.
- A clean start for your data. A migration is the chance to leave behind years of records you don’t need. Here’s an example to illustrate what we mean: After ten years in a system, some of them I haven’t done business with in three, 4, 5, 8 years, I probably don’t want to migrate those vendors.
Related Article: How to Create a Dynamics 365 Data Migration Strategy [2027]
The Dynamics AX to Dynamics 365 Migration Process
Ultimately, your AX version decides the AX migration to Dynamics 365 F&SCM process. Here’s how to determine what Dynamics AX to Dynamics 365 migration process you can expect.
AX 2012 R2 or R3: direct upgrade. Microsoft’s upgrade overview splits it into three phases:
- Analyze. Create an LCS project with the AX 2012 upgrade methodology. Run the upgrade analyzer, which reports on data cleanup, database settings, application settings, and deprecated features. Then run the code upgrade service on your exported model store.
- Execute. Resolve code conflicts, then upgrade the data. In development, you restore your AX 2012 database in Azure and run Microsoft’s data upgrade package. In sandbox environments, you use the AX 2012 Database Upgrade Toolkit for Dynamics 365.
- Validate. Test the upgraded environment and prepare for go-live.
AX 2009 or AX 2012 RTM: reimplementation with data migration. For an AX 2009 migration to D365, Microsoft’s Data Migration Tool maps AX tables to Dynamics 365 data entities and moves the data you select. Before you export, you choose target dimensions, review inventory dimensions, and pick a chart of accounts for each legal entity. Code and processes are rebuilt in Dynamics 365.
Every path ends in repeated test migrations. Our Dynamics AX to Dynamics 365 Finance and Operations migration approach is to run the migration in the conference room pilot (CRP), again in UAT, again in a mock go-live, and finally in production. We recommend using real data from the very first round, for three reasons:
- Users recognize it. With demo data, they’re going to say they don’t recognize that vendor, or that the GL accounts don’t make sense.
- You find extraction and transformation problems early.
- A subset, such as the first 100 customers and vendors and a point-in-time GL entry, shows how long the go-live migration will take, and whether or not it is going to be a bottleneck in your go live.
Related Article: How to Run an AX 2012 Upgrade to Dynamics 365 Finance
How to Manage Security Roles When Migrating from AX to Dynamics 365
Security in Dynamics 365 follows the same role, duty, and privilege model you know from AX. But custom AX security roles don’t move over automatically, and a few things change:
- Sign-in moves to Microsoft Entra ID. Microsoft’s AX 2012 preupgrade checklist requires Entra sign-in information for every user.
- Record-level security works differently. Rules that filter which records users can see must be rebuilt in Dynamics 365.
- Roles map to license types. What a user can access affects which Dynamics 365 license they need.
To rebuild roles well:
- Build and test custom roles in a development or UAT environment, then move them to production.
- Use task recordings with security diagnostics to see which privileges real workflows actually need.
- Check segregation of duties early, before UAT.
- Treat the migration as a chance to remove permissions that piled up over years in AX.
The licensing risk, in particular, is important to note, especially when you bring in new users, such as after an acquisition. Teams with different norms will ask, “Why can’t I see this report?” Then you start granting different accesses and so on. And if you are not careful, you could impact your license.
Weāre Migrating from Dynamics AX to Dynamics 365. What Should We Expect, and Who Can Help?
What to expect:
- A platform change, not a version bump. You’re moving from servers you run to a service Microsoft runs.
- Customizations to revisit. AX overlayering doesn’t carry over. Code is either converted into extensions or retired.
- A narrower data scope. In a reimplementation, companies usually migrate a time frame set by IRS requirements, such as three or five years, or they elect to just migrate balances.
- A new way of working. The browser-based interface is different from the AX client, so user training matters.
- Several rounds of testing. Expect the migration to run in CRP, UAT, and a mock go-live before production.
Who can help:
- Microsoft provides the tools: Lifecycle Services, the upgrade analyzer, the code upgrade service, the data upgrade packages, and the AX 2009 to D365 Data Migration Tool.
- A Microsoft Solutions Partner brings the people and experience: assessment, code remediation, data migration, testing, and support after go-live.
Common Dynamics AX to Dynamics 365 Migration Challenges & Pitfalls
| Pitfall | What to do instead |
|---|---|
| Assuming AX code can be lifted and shifted | Overlayered code doesn’t carry over. Retire what Dynamics 365 does natively, and convert the rest into extensions. |
| Migrating everything | Migrate master data, open transactions, and the history compliance requires. Archive the rest. |
| Massaging data in Excel | This is a worst practice: Every time you do data migration, it’s like you’re doing it for the first time. Use a repeatable extract, transform, and load process. |
| Duplicate and stale records | Flag records you don’t want in AX so they’re excluded at extraction. For example, imagine you have three spellings of the same vendor: bring over one, and combine the history from the others on load. |
| A structure AX never had | Dynamics 365 may require things like a cost center financial dimension on certain accounts. You need rules to apply that kind of logic. |
| Testing with demo data | Use real AX data from the first conference room pilot, so users recognize it. |
| Underestimating multiple legal entities | With the standard data management framework, the example of 8 data types across 10 companies is 80 imports plus, and 80 opportunities for human error. |
| Version limits | Only AX 2012 R2 and R3 can upgrade directly. AX 2009 and AX 2012 RTM need another path. |
| Neglecting continuous updates | Plan regression testing for Microsoft’s ongoing updates after go-live. |
How to Prepare for a Dynamics AX to Dynamics 365 Migration
- Choose your path. That’s a direct upgrade (AX 2012 R2/R3, latest cumulative update, no virtual companies or data partitions) or a reimplementation.
- Run Microsoft’s assessment tools. Use the upgrade analyzer and code upgrade service in Lifecycle Services to size data cleanup and code work.
- Audit customizations and ISV add-ons. Decide what to keep, convert, or retire, and confirm each ISV has a Dynamics 365 version or replacement.
- Set a configuration baseline. Before you migrate data, you need a baseline for your configurations. Define required fields and their values. For example, if all of your vendors are net 30, have you set up a net 30 term of payment in D365 to support that?
- Configure every legal entity.Ā Make sure every company you’re migrating into is properly configured, so when I upload those vendors or customers or whatever, I don’t run into a bunch of errors.
- Define scope and clean the data. Decide how much history to bring, exclude records you don’t need at extraction, and resolve duplicates.
- Define mapping rules. Map your old chart of accounts and other structures to the new ones dynamically, not by hand.
- Plan integrations, reports, and training. Rebuild integrations, plan your Power BI and financial reporting, and schedule user training.
- Schedule your test rounds. Plan for CRP, UAT, and mock go-live migrations before production, plus a rollback plan.
Do I Need to Buy Licenses for a Dynamics AX to Dynamics 365 Migration?
Yes. Dynamics 365 is licensed by subscription, per user, per month. Microsoft lists Dynamics 365 Finance at $210 per user per month, paid yearly, on itsĀ pricing page. Your existing AX licenses don’t simply carry over as Dynamics 365 subscriptions. Timing matters too. Microsoft’s upgrade overview notes that the Analyze phase can be done before you buy, but the Execute phase requires purchasing finance and operations apps. Ask your Microsoft partner about any transition options for existing AX customers, and right-size your user licenses before you sign, since what each user can access affects which license they need.
How to Run a Dynamics AX to Dynamics 365 Migration
Once you’ve prepared, each migration run follows the sequence:
- Extract the data from AX, directly from the database or by running a report.
- Prepare it for import. This is the transform step, where you map what the data looks like in AX to what Dynamics 365 needs.
- Import it into Dynamics 365.
- Check that it came through successfully.
- Have someone validate it. Does my count of records that were migrated match the count of records that were exported, and did every transformation happen correctly?
Run those steps in every test round: CRP, UAT, mock go-live, then production. For a direct AX 2012 upgrade, Microsoft’s Analyze, Execute, and Validate phases wrap around the same discipline. In a real-life customer example, a go-live migration covered:
| Data type | What it includes |
|---|---|
| Master data | Customers, vendors, fixed assets, bank accounts, workers |
| Ledger | Ledger balances over time |
| Open receivables and payables | Unpaid customer and vendor invoices |
| Fixed assets | Depreciation balance at a point in time |
| Cash | Bank account balances |
| Open orders | Open purchase orders and open sales orders |
If you have many legal entities, plan the import method carefully. With the data management framework (DMF) that comes standard in D365, you import each data type for each company. With AMCS, you can put all my AMCS data migration data into a single file with the tab for each thing that we’re importing, and I can just import that file once for all companies.
Journals also post automatically with AMCS, while the data management framework imports journals unposted and leaves posting as a separate step.
How to Manage Dynamics AX Customizations Migration to Dynamics 365
Customizations are a key consideration for every AX 2012 to D365 migration:
- Inventory everything. Catalog every X++ customization, report, workflow, and ISV add-on, and who uses it.
- Keep, retire, or rebuild. Retire customizations that standard Dynamics 365 now handles. Adapt processes to standard where you can. Rebuild only what truly differentiates your business or is needed for compliance.
- Use Microsoft’s tools. For AX 2012 R2/R3, the LCS code upgrade service converts your exported model store and reports conflicts for developers to resolve.
- Move from overlayering to extensions. Dynamics 365 doesn’t allow changes to base code. Use extensions, such as Chain of Command and event handlers, instead.
- Rebuild reports, workflows, and integrations. Rebuild legacy reports, batch jobs, and point-to-point integrations with Dynamics 365 tools.
- Test thoroughly. Regression-test converted code in a sandbox before production, and again after Microsoft’s updates.
How Much Does it Cost to Migrate AX to Dynamics 365 Finance?
There are two parts to the AX to D365 migration cost: subscription licensing and the project itself.
Licensing: Microsoft lists Dynamics 365 Finance at $210 per user per month, paid yearly, and Finance Premium at $300 per user per month (Microsoft pricing).
The project: Costs vary widely. The biggest drivers are:
- Your starting version. A direct upgrade from AX 2012 R2/R3 differs from an AX 2009 reimplementation.
- Customizations and ISV add-ons that must be converted, rebuilt, or replaced.
- Data volume and how much history you migrate.
- Integrations with other systems.
- The number of legal entities. This is where costs can quietly multiply. Some companies are staring down the barrel of a 2,000 hour data migration bill when they have many legal entities. The reason is the multiplier: If I have 8 imports and 10 companies, that’s 80 imports plus, and using the framework instead of AMCS with 10 companies can easily mean 20 times the effort.
When you review a vendor’s estimate, ask how they’ll handle the data migration across every legal entity. That’s often where an estimate that seems out of whack comes from.
Dynamics AX to Dynamics 365 Transition Plan
Partners commonly put AX-to-Dynamics 365 projects at 9 to 18 months, depending on version, customizations, data, and entities. An AX to D365 migration and transition plan typically moves through:
| Stage | Key activities |
|---|---|
| 1. Assessment and discovery | Audit modules, customizations, ISVs, integrations, and reports. Run the upgrade analyzer and code upgrade service. |
| 2. Strategy and design | Choose a direct upgrade or reimplementation. Run a fit-gap analysis. Decide what data to migrate and archive. For acquisitions, decide whether to merge into your structure. |
| 3. Data preparation | Set a configuration baseline, clean data at the source, and define mapping rules. |
| 4. Code and customization remediation | Retire, convert, or rebuild customizations as extensions. |
| 5. Integrations and reporting | Rebuild integrations and reports with Dynamics 365 tools. |
| 6. Testing | Migrate real data in CRP, UAT, and a mock go-live. Validate record counts and balances each round. |
| 7. Training and go-live | Train users, cut over, and provide hypercare. |
Get Top 1% Dynamics AX to Dynamics 365 Migration Services
So, now you know everything you need to in order to navigate an AX 2012 migration to D365 F&SCM. You’re the one who answers for it if go-live data doesn’t match what the business expects. Avantiico is recognized among the top 1% of Microsoft AI partners worldwide and has worked with Microsoft Dynamics since 2006. We help AX customers move to Dynamics 365 with a repeatable migration process: real data from the first round of testing, rules-based mapping into your new structure, and AMCS to import once for every legal entity instead of company by company. Explore Dynamics AX to Dynamcis 365 F&SCM migration services.
FAQ on Dynamics AX to Dynamics 365 Finance and Operations Migration
Is Dynamics AX still supported?
No. Extended support for AX 2009 SP1, AX 2012, and AX 2012 R2 ended April 12, 2022. AX 2012 R3 ended January 10, 2023.
Can every AX version upgrade directly to Dynamics 365?
No. Only AX 2012 R2 and R3 have a direct upgrade path. AX 2009 uses Microsoft’s Data Migration Tool, and AX 2012 RTM isn’t supported for a direct upgrade.
Should we migrate all of our historical data?
Usually not. Most companies migrate a time frame based on IRS requirements, such as three or five years, or just balances. Migrating transaction-level detail is pretty unusual.
How should we handle an acquired company running AX?
First decide whether it adopts your chart of accounts and conventions or stays a separate group of companies. Where possible, best practice would be to merge the data, especially when the business model is the same. Company size, culture, and change management can change the answer.
How many times should we test the migration?
We recommend running it in CRP, UAT, and a mock go-live before production, resolving and documenting errors each time.
Do we need new licenses?
Yes. Dynamics 365 is licensed by subscription, and you’ll need to purchase finance and operations apps before the Execute phase of an upgrade.
