Problem Statement:
Microsoft Dataverse disables users when we delete user from Azure Active Directory or the Microsoft 365 admin center. However, these disabled users still occupy space and holds historical records. To overcome this issue, Dataverse offers a feature that enables the removal of disabled users.
Solution:
Microsoft has introduced new feature to delete disabled AAD users directly from Power Platform.
Enable feature:
- Navigate to Admin Center -> Environment -> Settings -> Feature.

- Activate Delete disabled users (preview) feature.

How to delete user
Once we enable this feature, we can delete all disabled users of AAD directly in dynamics/power platform:
- Navigate to Admin Center -> Environment -> Settings -> Users. Select filter:
Before enabling feature

After Enabling feature

- Select User and click “Delete user”. This will permenantely delete user from current environment.
Conclusion:
Thus, using this new feature, we can now directly delete disabled/deleted AAD users from Power Platform/Dynamics.