The 20 MB is the message, not the file
Most people read a 20 MB limit as 'a 20 MB file will send'. It will not. Microsoft's wording is that the limit covers the attachment and the email together, so every line of body text, every signature image and every header takes its cut of the same allowance.
Then encoding takes another third. A PDF of 16 MB becomes roughly 21 MB once the mail server encodes it as text, which is over a 20 MB ceiling without a single byte of body text. The practical attachment size for Outlook.com sits closer to 14-15 MB, not 20.
Business accounts default to 10 MB for the same reason, and an administrator can lower or raise it. If you are on a company mailbox, the number you need is in the organisation's mail policy, not on the public page.
Why Outlook refuses instead of swapping in a link
Attach something too large and Outlook returns an error rather than improvising. That is the opposite of Gmail, which quietly uploads the file to Drive and replaces it with a link - and for most people the error is the better outcome, because you find out before the message goes.
The message you get varies by client: Outlook on the web and the desktop clients word it differently, and the attachment may simply disappear from the compose window on some versions. If an attachment vanishes as you attach it, that is the limit, not a bug.
Microsoft's own page on the subject suggests three ways out: save the file to a cloud service and share a link, save it to a SharePoint library, or compress the file. The order they list them in is telling - a link is the default answer for anything bulky.
Getting the PDF under 10 or 20 MB
Decide which ceiling applies first. A personal Outlook.com account has 20 MB; a company Exchange mailbox usually has 10. Compressing to 18 MB is useless if the real limit is 10.
Leave room for encoding. Aim at 8 MB for a 10 MB account and 15 MB for a 20 MB one, then check the actual bytes rather than trusting the file manager's rounding.
Compress the document, not the archive. Zipping a PDF gains almost nothing, because the PDF is already compressed internally; rebuilding it is what removes the weight. A text PDF rebuilt to the target keeps selectable, searchable text, which matters when the recipient is going to read, quote or fill it in. Pages that have to be re-rendered become images, and anything on those pages that was interactive - links, form fields, signatures - stops being interactive.
When a OneDrive link is the right call
For anything that is not a document - a photo set, a recording, a design export - a shared link beats compression. OneDrive links keep the original quality, do not count toward the message size, and can be revoked.
The catch is that a link is not a file. Recipients behind corporate filters, or applying through a portal that wants an upload, cannot use it. That is the case compression exists for: the document has to arrive as a PDF, so it has to be smaller.