Extensions is, I believe, the number of "lines" you have be they on one number or several. One extension means just one call in progress at any time.
Three handsets - does not mean you will have three "extensions" unless you want teh ability to have three calls in progress.
I have several VOIPify numbers, for historic reasons, and pay £1/month for each, but just ONE extension as it is rare that we ever had more than one call in progress.
So, for a residential with one number and many handsets, you only really need ONE extension.
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