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Guidance on eligible costs

TalEntEd WP3 - eligible grant costs and in-kind contributions

Eligible grant costs

The following costs are eligible for inclusion in applications for a Develop or Adopt Innovation Grant, to be awarded as part of Work Package 3 within the TalEntEd Islands Programme. Should there be uncertainty on whether or not a cost is eligible, please contact the Innovation Development Manager for this work package – TALENTEDWP3@HW.AC.UK .

The costs of undertaking a proposed project, relative to the potential value it adds, will be a primary factor influencing the decision of the work package’s Industry Advisory Board on whether to award an Innovation Grant. It is essential to demonstrate value for money and reasonableness across all of the following cost items when including them in an application.

All eligible costs must be fully supported by an auditable record in justification of a claim. Claims for the cost of university staff time must be justified by the use of timesheets.

  1. University Staff Time: cost for the time of university employed academic staff (Heriot-Watt, RGU or UHI) when directly contributing to a project. This includes salaries, employer's National Insurance (NI) and pension contributions but excludes any overhead payment. Any costs associated with a member of academic staff not working directly on a project, such as sick leave, training days and maternity leave are ineligible.
  2. Travel and Subsistence Costs: cost of economy travel and subsistence to attend meetings and other events directly associated with the undertaking of a project. All costs must be reasonable and, in the case of a university member of staff incurring costs, must align with their relevant institutional policy - all travel and accommodation must also be booked through their centrally appointed travel management company. For costs incurred by staff employed by a company or third sector organisation, this must align with the maximum cost limits included within the Travel and Expenses Policy operated by Heriot-Watt University[1].
  3. Consumables: costs for any materials directly used in a project, including raw materials, chemicals and other similar items, including for those used for producing prototypes or in the development or testing of innovative products, processes or services; additional eligible costs include materials and copying costs for report production, and basic office consumables.
  4. Equipment: costs for new machinery, tools and technology essential for the undertaking of a project that cannot be accessed elsewhere, noting that desk-based or portable ‘office’ IT equipment and the depreciation cost of existing equipment are not eligible costs.
  5. Facilities Access: costs for access to University or third-party testing facilities or equipment.
  6. Other Directly Incurred: where project costs are identified and are directly attributable to a project’s likely success, but do not fall within the above definitions or judged to be in-kind contributions, these should be discussed with the Innovation Development Manager to determine eligibility. Such costs might include those related to market assessment studies, regulatory compliance costs or software licence costs.
  7. VAT: where a company or third party organisation is not registered for VAT, it can claim VAT as an eligible project cost (i.e. irrecoverable VAT). Universities can include VAT as an eligible project cost.

In-kind contributions

The following costs are not eligible for funding and will be treated as an ‘in-kind’ contribution to a project:

  1. The University overhead costs associated with the academic time contribution on a project – such overhead costs are calculated on the basis of full economic costing, as defined by the UK research councils.
  2. The cost of the time of company/third sector staff engaged on a project.
  3. The cost of company/third sector overheads arising from the undertaking of a project.
  4. The cost associated with accessing equipment, facilities or other similar resources within the company/third sector organisation, necessary for the undertaking of a project.
  5. Subject to paragraph ‘7. VAT’ above, any tax liabilities arising from the award of an innovation grant.

It is recognised that there may be other potential in-kind contributions from either the University or the company/third sector organisation, identified on a project case-by-case basis.