Indirect Costs Practice

As a policy, Western applies 40 per cent indirect costs on all direct costs of sponsored research. Direct costs include salaries, equipment, materials and reagents, and travel. Overhead, or indirect costs, are actual costs the university incurs to support research at Western, including maintaining laboratories, facilities and equipment, staff and administration.

As a means of ensuring flexibility and competitiveness, the Vice-President (Research) has provided standing negotiated modifications to indirect cost rates — as outlined in the diagram below, — which are the minimum values to be applied.

Indirect Costs Rate Selector

For sponsored research funding and open calls, research project budgets must include eligible expenses as established by a Funding Agency/Sponsor and their specific funding opportunity guideline. Where indirect costs and/or overhead costs are an eligible expense, Western University requires project budgets include both direct costs and indirect costs. The overhead rate to be used in the project budget will be determined by the maximum rate allowed by a Funding Agency/Sponsor. If a maximum rate is not stipulated in writing by a Funding Agency/Sponsor, Western Research will confirm with the Agency/Sponsor the applicable rate to be included in the project budget.