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Preparing a Research Proposal Budget

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The majority of restricted funds are for research purposes. The receipt of these funds is the successful result of a process that begins with the researcher’s funding application to a research sponsor, that application having been duly reviewed and endorsed by the appropriate academic unit/division and by the Vice-President Research and Innovation. See the section Apply for Funding on the Research and Innovation website for more information.

This section focuses on the following:


Funding Mechanisms

As noted in the Research Administration Guideline associated with the University’s Research Administration Policy funds received in support of research will be recorded in a restricted research fund administered by the Division of the Vice-President Research and Innovation. The Guideline helps to distinguish research activities within the scope of the Policy from other contractual mechanisms such as donations to research (normally set up as Trust Funds by Financial Services) and service agreements (recorded within the operating funds of the academic division undertaking the activity). Please review the Policy and associated guideline for further detail.

Budgets are prepared based on the Sponsor’s program requirement. Guidelines on budgeting for Direct Costs is described below.


Direct Cost Considerations

Salaries – Salaries must be within the range for the appropriate University position classification.

  • Salary increases
    • Allowance must be made for upcoming salary increases (normally effective July 1st of each year).
    • A salary increase may include an across-the-board (economic) increase, and an appropriate merit/step increase in accordance with University guidelines and the applicable Collective Agreements between the University and the respective Unions representing those positions.
    • If upcoming increases have not been established at the time of proposal preparation, consult with the Human Resources Department with respect to appropriate estimates.

Vacation pay – add vacation pay of 4% for casual and term employees

Benefits – A standard benefit rate representing the full employer cost of benefits will be charged to the award. The current rate as a percentage of salary for appointed staff and non-appointed staff can be found on the Standard Benefits Rates page of Financial Services website.

Computing costs – Ensure that the cost of computing services is considered.

Travel costs – The sponsoring agency may have guidelines or limits with respect to travel costs. Information on these restrictions can be found on the Sponsor’s website, or in the Sponsor’s guidelines on allowable travel expenses for the funding opportunity. Applicants can also refer to Travel and Other Reimbursable Expenses for University regulations with respect to eligible and ineligible travel costs. It must be noted that in all cases, the more stringent policy (sponsor or University) should apply.

Supplies and Equipment – The cost of specific supplies and equipment requirements should be identified and estimated using the best available information, e.g. supplier’s price lists. In the case of significant and specialized items, consult with Procurement Services for further advice on cost estimation.


Harmonized Sales Tax (HST)

  • HST included in costs – This relates to the HST included in the goods and services which the researcher purchases to conduct research. The majority of goods and services purchased are subject to HST (the notable exceptions are salaries and wages). Research activity is not HST-exempt and, therefore, HST must be considered when estimating costs of research. The University, however, is part of the MUSH group of organizations (municipalities, universities, schools, and hospitals), which receive a partial rebate of HST. The rebate to universities is 67% for the GST portion of the HST and 78% for the provincial (OVAT) portion of the HST. The net HST cost after the rebate is 3.41% and, therefore, the cost of goods and services will be 1.0341 times the supplier’s before-tax price. If the supplier’s price includes HST, the cost to the researcher after the rebate can be calculated as: supplier’s price x 0.91513. (Note: Certain research funders outside of Canada do not permit any form of value-added tax to be charged to their funding. Award-holders should diligently review the sponsor’s eligible expense guidelines and consult with their contact in the Division of Vice-President Research and Innovation if they require further assistance.)
  • Generally, sales by the University of research services are HST exempt.  This is because most services supplied by a public institution are exempt under Canadian Excise Tax Act (“ETA”), unless the specific service is excluded from the exemption. If the research service includes the production of some tangible personal property (i.e. prototype) and a report accompanies the TPP,  then the sale of such services could be considered HST taxable. If the research services agreement includes other supplies being made, such as a right to access space (a GST/HST-taxable license to use space) or a lease of space (which could be GST/HST-taxable depending on location) then the research services agreement may be HST taxable. If the research service is made in Canada and sold to a non-resident then it may be considered as zero-rated, which means 0% HST is charged.For help on determining whether HST should be charged on research services that include Tangible personal property or some other supply, please email .


Budget Categories for Direct Costs

In most cases, sponsors identify eligible cost categories that may be used when applying for funding. For sponsors that do not provide any guidance, the following list (standard budget categories from AMS) can be used as a guideline.

Salaries & Wages (in accordance with University classifications)

  • Research Assistant
  • Supplements
  • Faculty Consultant
  • Interviewer
  • Computer Programmer
  • Editorial Assistant
  • Technician
  • Subject
  • Hourly Personnel
  • Staff Benefits
  • Annual Salary Increases
  • Vacation Allowance

Materials & Supplies

  • Office supplies
  • Communications, with the exception of one basic telephone
  • Test materials
  • Questionnaire forms
  • Animals
  • Animal Food
  • Laboratory supplies
  • Glassware
  • Chemicals
  • Electronic supplies
  • Report materials and supplies


  • Equipment that needs to be procured
  • Moveable equipment
  • Office equipment
  • Equipment rental (including laptops, vehicles, and rental charges necessary to use another person’s equipment)
  • Equipment installation
  • Equipment repairs & maintenance


  • Administrative
  • Field Work
  • Professional meetings
  • Travel for consultation
  • Consultants’ travel
  • Automobile rental
  • Aircraft rental
  • Ship rental


  • Computer services (at 100% of cost)
  • Consultants
  • Duplication services (reports, etc.)
  • Publication costs
  • Photographic services
  • Service contracts
  • Machine shop services


  • Space rental outside the University
  • Alterations/ renovations
  • Purchase of periodicals and books
  • Patient reimbursement
  • Tuition and fees (training grants)
  • Hospitalization
  • Page Charges


Indirect Costs

Helpful information on budgeting for indirect costs can be found in the Indirect Cost section of the VPRI website.


Last revision October 2016