Please consult these frequently asked questions for information on UBC's recovery of the indirect costs of research.
If your questions remain unanswered, please contact us.
Indirect costs of research are real, ongoing, necessary operating expenses that cannot be wholly attributed to any one department, project or product. They include elements such as:
- Building and facility operating costs including heating, cooling, power, cleaning, maintenance;
- Faculty and departmental services such as machine and electrical shops, grant facilitation, secretarial and office assistance, purchasing, shared equipment, etc.;
- Academic services such as the Library and Computing Service;
- University-provided administrative services such as Purchasing, Finance, and Human Resources; and
- Research and contract administration & support such as Office of Research Services, University-Industry Liaison Office, Research & Trust Accounting, CFI Office, Health Research Office, Hospital Research Institute Administrations, etc.
Unlike direct costs of research, many of the indirect costs are incurred whether or not research funding applications and proposals are successful.
For research activities to be sustainable, both the direct and indirect costs must be fully recovered. This is increasingly important as UBC’s level of research funding continues to increase.
Starting May 1, 2015, the required indirect cost recovery rate for all new industry-funded projects is increasing from 25% to 40% of direct costs. As a result, the indirect costs recovery rates will be:
- 25% of all direct costs for all non-industry funding (government and non-profits)
- 40% of all direct costs on all industry funding
All industry projects initiated prior to May 1, 2015 may continue to recover indirect costs at a rate of 25%.
The only exceptions to this rate will continue to be funds from any of the Tri-Council funding agencies (apart from the SSHRC-administered Tri-Agency New Frontiers in Research Fund. Applicants to this fund should contact ORS about building indirect cost recovery into their application) and funds through grant applications that specify a verified, alternate rate.
The only exceptions to the standard rate are funds from the Tri-council agencies, (which provide indirect cost payments annually through the Federal Research Support Fund - formerly the Indirect Costs Program), and certain grant applications when any of the following conditions are met:
- The grant application form clearly states a different indirect costs recovery rate that applies to all applicants; or
- The alternate rate can be verified (by UILO or ORS, as the case may be), through publicly-available documents, or the sponsor’s website.
If either of these conditions are met, UBC will accept the posted rate. An Indirect Costs of Research Rates Table lists many verified exceptions to the standard UBC rates (CWL required to log in).
This standard is used worldwide by industry and government and is referred to as a “price” model, instead of a “cost” model.
For example, the price for personnel would be (salary + benefits) x 125% (x140% for industry) = total salary price.
When an application form of a sponsor requires that indirect cost be presented as a separate line item, budgets should include an indirect costs line-item equal to 25% of the total costs (or other, agency-specific rate) and 40% for industry. In other words, a “cost” model should be used.
Examples of these programs include, NSERC Collaborative Research and Development Grants, NSERC Idea to Innovation Grants, SSHRC Partnership Grants, CIHR Industry Partnered Collaborative Research Program, CIHR Proof of Principle Grants.
In these cases, the agency may require that direct and indirect costs be shown separately in the budget submitted to the Tri-Council agency.
In all cases, an indirect cost recovery rate of 40% must be applied to the matching funds provided by the industry partner (25% if initiated prior to May 1, 2015).
Indirect costs should not be applied to the funds requested from the Tri-council agency.
The distribution of indirect costs recovered through the Research Support Fund relating to Tri-council agency funds is very complex.
Indirect costs recovered from other sources for research projects carried out at the UBC campuses will be distributed on a slip-year basis as follows:
As of May 1, 2015, there are two changes to the distribution of recovered indirect costs for new projects:
- An increase in the share being returned to faculties from 50% to 75%.
- The ability for approved centres and institutes to receive a share of recovered indirect costs.
Where there is no involvement of an approved centre or institute, the new distribution will be:
- Central Services (General Purpose Operating Fund): 25%
- Faculty Dean: 75%
If research is conducted primarily at an approved centre of institute, the allocation will be as follows:
- Central Services (General Purpose Operating Fund): 25%
- Faculty Dean: 25%
- Eligible centre of institute: 50%
Indirect costs recovered from projects carried out at any of the affiliated teaching hospitals, including VCH facilities located at the Point Grey campus, are generally shared as follows:
- Clinical Trials: UBC – 20%, Hospital – 80%
- Other Projects: UBC – 50%, Hospital – 50%
The UBC share of hospital-generated indirect costs of research is then distributed as described above.
The current list of approved centres and institutes is as follows:
Advanced Materials and Process Engineering Laboratory (AMPEL)
Biomedical Research Centre
Centre for Advanced Wood Processing (CAWP)
Centre for Applied Ethics
Centre for Biodiversity Research
Centre for Blood Research (CBR)
Centre for Brain Health (CBH)
Centre for Excellence in Indigenous Health (CEIH)
Centre for Health Education Scholarship (CHES)
Centre for Health Evaluation & Outcome Sciences (CHEOS)
Centre for Health Services & Policy Research (CHSPR)
Centre For High-Throughput Biology (CHiBi)
Centre for Hip Health & Mobility
Centre for Interactive Research on Sustainability (CIRS)
Centre for Molecular Medicine and Therapeutics (CMMT)
Clean Energy Research Centre (CERC)
Human Early Learning Partnership (HELP)
Institute for Computing, Information and Cognitive Systems (ICICS)
International Collaboration on Repair Discoveries (ICORD)
James Hogg Research Centre
Life Sciences Institute (LSI)
Pulp and Paper Centre (PPC)
Quantum Matter Institute (QMI)
UBC Centre for Disease Control (UBC-CDC)
Indirect costs will, however, be charged against salaries paid to student and post-doctoral assistants from research grants and contracts (i.e., projects set up by the University-Industry Liaison Office or Office of Research Services).