In-kind contribution (IKC) (in ESA terms) refers to a type of allowable cost that can be accrued to the activity total cost. The ESA definition of in-kind contribution is the following:
- The expenditure has actually been incurred and separately recorded as being company funded product development.
- The IKC cost quoted for the proposed activity is at least 2/3 directly attributable to hardware elements. The remainder, at the maximum 1/3, is for software/assembly/ integration/test to make the hardware a functional unit.
- The IKC has not been paid with any public funds.
- Contributions such as but not limited to materials, information, equipment and services obtained by the Contractor free-of-charge do not qualify as eligible costs and therefore cannot be claimed as in-kind contributions.
- The item cost/depreciation related to the item (in case the item has been capitalised) has not been recovered through the rates (including overhead rates) or other cost elements.
- The item has not been subject to revaluation in the two calendar years before that of the start of the current activity.
- The maximum depreciation for IKC shall not exceed 20% of the overall cost of the activity.
- The IKC is of direct benefit to the proposed activity, as described above. Payments related to the IKC shall only take place upon use of the IKC and shall otherwise be forfeited.
Please also refer to the question “What is an allowable (eligible) cost for the activity?”
Please refer to the General Clauses and Conditions for ESA Contracts (ESA/REG/002 rev. 3) Annex 1, Section 4 for the allowable costs.