Eligible costs

On this page

• Eligibility conditions
• Funding instruments
  • Research and Innovation Actions (RIA)
  • Innovation Actions (IA)
  • Coordination and Support Actions (CSA)
• Types of costs
• Standard budget categories
• Ineligible costs
• Horizon Europe vs. Canadian grants
• Additional information

Eligibility conditions

Project costs and contributions are eligible for reimbursement if they meet the eligibility conditions set out in the Grant Agreement. Grants are typically based on actual costs, which must:

• Be incurred by the beneficiary
• Be incurred during the project
• Be declared under one of the budget categories 
• Be incurred in connection with the activity and be necessary for its implementation
• Be identifiable, verifiable and recorded in the beneficiary's accounts according to applicable accounting standards and practices 
• Comply with applicable national tax, labour and social security laws
• Be reasonable, justified, and comply with sound financial management principles

For more information, see Article 6.2 of the EU Grants: AGA – Annotated Grant Agreement.

Funding instruments

For each topic, the Commission indicates a specific "funding instrument" (or "type of activity"). The funding instrument defines the type of project, and type of award, that the Commission will support to address a given topic.

Types of costs

Horizon Europe costs consist of direct and indirect costs. Direct costs are directly linked to performing the tasks laid out in the Description of the Action in Annex 1 of the Grant Agreement. These descriptions are the activities that are directly related to the project. Direct costs are funded based on actual costs or fixed unit costs, and depend on the type of action. A summary of eligible activities and their respective funding rates is provided in the table below. For more information, consult the Horizon Europe Work Programme 2025 – General Annexes.

Indirect costs are not directly linked to the project, but are necessary for its implementation. Examples include overhead costs, such as office rent or operating costs, as well as other costs that cannot be directly linked to the action. Funding for indirect costs are funded at a flat rate of 25% of eligible direct costs. Actual indirect costs for the action do not need to be reported. For more details on indirect costs, consult the Data Sheet in the EU Grants: Annotated Grant Agreement.

Standard budget categories

Horizon Europe has four standard budget categories, outlined in Article 6.2 of the EU Grants: Annotated Grant Agreement and described below:

• Personnel costs: Employees (or equivalent), individuals working under a direct contract, personnel seconded by a third party, small- and medium-sized enterprise owners not receiving a salary, and beneficiaries not receiving a salary
• Subcontracting costs: Contracts for parts of a project implemented by a subcontractor (rather than the beneficiary)
• Purchase costs: Travel costs, equipment, and other goods and services necessary to implement the project
• Other cost categories: Financial support to third parties, internally invoiced goods and services, and other costs outlined in the Grant Agreement that do not fall under personnel, subcontracting, and purchase costs

Ineligible costs

The following costs or contributions are ineligible:

• Those declared under other European Union (EU) grants (or grants awarded by EU Member States, non-EU countries or other bodies implementing the EU budget), with exceptions for collaborative actions and operating grants. These exceptions are outlined in Article 6.3 of the EU Grants: Annotated Grant Agreement.
• Those that do not comply with the conditions set out in Article 6.1, 6.2 of the EU Grants: Annotated Grant Agreement, including:
  • Return on capital and dividends paid by a beneficiary
  • Debt and debt service charges
  • Provisions for future losses or debts
  • Interest owed
  • Currency exchange losses
  • Costs charged by the beneficiary's bank for transfers from the granting authority
  • Excessive or reckless expenditure
  • Deductible value-added tax (VAT)
  • Costs incurred during Grant Agreement suspension (if applicable)

Horizon Europe vs. Canadian grants

Eligible costs under Horizon Europe (administered by the European Commission) differ from those covered by the Tri-Agencies.

Eligible research expenses under Tri-Agency-funded grants are outlined in the Tri-Agency Guide on Financial Administration (TAGFA). Under TAGFA, expenses must follow the principles and directives (mandatory requirements) that govern the use of grant funds.

Expenses are eligible for reimbursement if they respect the following four principles:

1. Contribute to direct research/activity costs
2. Not be provided by the administering institution to their research personnel
3. Be effective and economical
4. Not result in personal gain for members of the research team

These expenses must fall into one of the following budget categories:

• Employment and compensation expenses: The employment and compensation of individuals working on the funded research/activities
• Goods and services expenses: The acquisition of goods and services for the funded research/activities
• Travel and travel-related subsistence expenses: Travel and travel-related subsistence expenditures
• Hospitality expenses: Hospitality expenses (non-alcoholic refreshments and/or meals) directly related to the funded research
• Gifts, honoraria and incentives: Gifts, honoraria and incentives can be offered to an individual or group not part of the grant team and whose involvement in the funded research/activities is voluntary (that is, not part of a contractual obligation or professional service). However, providing gifts and incentives to participants requires prior approval from the administering institution's research ethics board. Grant recipients have an ethical duty to protect participants' confidential information and provide documentation to justify gifts and incentives. For more information on the specific guidelines on reimbursement of Indigenous people participating in funded projects, visit the Tri-agency guideline on renumeration for Indigenous people participating in funded projects page.

The following chart provides a summary of eligible costs under Horizon Europe compared to those under the Tri-Agencies. Section 1 covers eligibility criteria and Section 2 covers eligible cost categories.

Additional information

• EU Grants: AGA – Annotated Grant Agreement
• Horizon Europe: Model Grant Agreement
• Tri-agency Guide on Financial Administration