Eligibility of Direct Costs. Eligible costs are costs actually incurred by the Recipient, which meet all the following criteria: They are incurred during the implementation of the Action as specified in article 2 of this Agreement; They are indicated in the overall budget for the Action (Annex 2); They are necessary for the implementation of the Action; They are identifiable and verifiable, in particular being recorded in the accounting records of the Recipient and determined according to the applicable accounting standards; They comply with the requirements of applicable tax and social legislation; They are reasonable, justified and comply with the requirements of sound financial management, in particular regarding economy and efficiency. Subject to the above, the following direct costs of the Recipient shall be eligible: Contribution to personnel costs Costs for local travel (car rental, public transport, in-country flights,…) Costs for hotel and subsistence (per diem) Equipment (small items only, such as camera) Costs for infrastructure in relation to project proportion: electricity, internet, tel/fax Other Costs, services, such as publications (layout and print), visibility, financial services Costs for activities, such trainer and consultants, who receive fees/daily rates, costs for software, room rent for offline events Non-eligible costs: Purchase of bigger items, vehicles or furniture, land or buildings Debts and debt service charges (interests) Provisions for losses or potential future liabilities Costs declared by the recipient and financed by another action or work programme receiving a European Union grant (including through the European Development Fund) Currency exchange losses Office rent, unless the applicant can demonstrate that additional and specific office rental is necessary for the purpose of the action implementation; Taxes, including VAT, unless the Recipient can demonstrate they cannot reclaim them Credit to third parties In kind contributions (e.g. valorisation of existing equipment, donations, volunteer works etc.) Salary costs of the personnel of national administrations, unless otherwise specified in the special conditions and only to the extent that they relate to the cost of activities which the relevant public authority would not carry out if the action were not undertaken Performance-based bonuses included in costs of staff
Eligibility of Direct Costs. The Auditor verifies the eligibility of direct costs with the terms and conditions of the Grant Agreement notably Article II.19 of the General Conditions. He verifies that these costs: - are necessary for carrying out the action. In other words the Auditor verifies that expenditure for a transaction or action has been incurred for the intended purpose of the action and that is has been necessary for the activities and objectives of the action. The Auditor further verifies that the direct costs are provided for in the Grant Agreement Budget and comply with the principles of sound financial management, in particular value for money and cost effectiveness; - have actually been incurred by the Beneficiary or his partners during the implementation period of the Action as defined in Article I.2 of the Special Conditions; - are recorded in the accounts of the Beneficiary and are identifiable, verifiable and substantiated by originals of supporting evidence.
