Erasmus+ budget rules explained: what you can and cannot fund

One of the most common causes of queries, delayed balance payments and partial grant recoveries in Erasmus+ projects is not poor project management — it is a misunderstanding of what the programme will and will not fund. Erasmus+ has specific, clearly defined budget rules that vary by Key Action. Knowing these rules before you build your budget — not after — is what separates a financially clean project from one that creates problems at the reporting stage.

This guide explains the budget rules for the three most widely used Key Actions — KA210, KA220 and KA1 — covering what costs are eligible, what is explicitly excluded, how each budget model works and the most common budget mistakes that cost organisations money at the final report stage.

1. How Erasmus+ Budgets Work: The Two Models

Erasmus+ uses two distinct budget models depending on the Key Action. Understanding which model applies to your project is the starting point for all budget planning — because the two models have fundamentally different logic, different documentation requirements and different risks.

The unit cost model. Used in KA1 and KA220, the unit cost model calculates most budget categories automatically from predefined rates set by the European Commission. Staff costs are calculated from daily rates multiplied by working days. Travel is calculated from distance bands. Individual support (accommodation and subsistence) is calculated from daily rates by destination country. These rates are fixed — they do not vary with actual costs incurred. The grant is determined by the number of units, not by receipts. However, for some KA220 cost categories — subcontracting, equipment and exceptional costs — real costs apply and receipts or invoices are required.

The lump sum model. Used in KA210, the lump sum model provides a single predefined grant amount selected from a fixed tier structure. There are no individual cost categories, no unit rates and no receipts required. The grant is paid in full upon demonstrated delivery of the approved activities and outputs. The lump sum does not cover specific costs — it covers the project as a whole. This makes KA210 financially simpler but shifts the accountability entirely onto activity delivery.

Feature	KA210 — Lump Sum	KA220 — Unit + Real Costs	KA1 — Unit Costs
Budget basis	Fixed tier selected at application	Calculated from units × rates + real costs	Calculated from units × rates
Max grant	€60,000	€400,000	No fixed ceiling
Receipts required	No	For real cost items only	No
Payment basis	Activity delivery demonstrated	Units used + real costs incurred	Units used (participants, days, trips)
Evidence needed	Activity evidence — attendance lists, minutes, outputs	Timesheets, travel receipts, invoices for real costs	Attendance lists, participant records, travel evidence

2. Eligible vs Ineligible Costs: The Core Rules

Regardless of which Key Action you are applying for, a set of general eligibility rules applies to all Erasmus+ costs. These rules define what the programme will and will not pay for at the most fundamental level.

Cost Type	Eligible?	Conditions / Notes
Staff time spent on project activities	✓ Yes	KA220 only — via unit cost daily rates by staff category. Must be supported by signed timesheets.
Transnational travel costs	✓ Yes	KA1 and KA220 — via unit cost distance bands. Train expected for under 500km in 2026.
Accommodation and subsistence	✓ Yes	KA1 and KA220 — via individual support daily rates by destination country.
Subcontracting (translation, design, evaluation)	✓ Yes	KA220 only — real costs. Must be justified as not deliverable internally. Core intellectual work cannot be subcontracted to non-partners.
Equipment directly necessary for the project	⚠ Limited	KA220 only — real costs. Only the project-use proportion is eligible. Standard office equipment is not eligible.
Venue hire for project meetings or events	⚠ Limited	Covered within organisational support (KA1) or subcontracting/other direct costs (KA220). Must be directly linked to a project activity.
Inclusion support for participants with fewer opportunities	✓ Yes	Real costs up to defined ceiling. Must be justified per participant with specific barrier described.
VAT	⚠ Conditional	Eligible only if the organisation cannot recover it. Non-recoverable VAT on eligible costs is itself eligible. Recoverable VAT is never eligible.
Salary of existing staff not working on the project	✗ No	Only time actually spent on project activities is eligible. General overhead salaries are not covered.
Profit or organisational overhead	✗ No	Erasmus+ grants do not fund profit margins or general organisational overhead beyond the unit cost and organisational support categories.
Costs already funded by another EU grant	✗ No	Double funding is strictly prohibited. The same cost cannot be claimed from two EU funding sources simultaneously.
Costs incurred before project start date	✗ No	Only costs incurred between the project start and end dates are eligible. Preparatory costs before the official start are not covered.
Currency exchange losses	✗ No	Exchange rate losses between grant receipt and expenditure are not eligible costs.
Fines, penalties or legal disputes	✗ No	Never eligible under any circumstances.

3. KA210 Lump Sum Rules Explained

KA210 uses a lump sum model — the simplest budget model in the programme. Understanding its logic is essential because the simplicity creates a specific accountability risk that many first-time coordinators underestimate.

How the lump sum works. At the application stage, you select a grant tier from a predefined set — typically ranging from €10,000 to €60,000 in increments. You do not build a line-by-line budget. You do not attach cost estimates. You simply select the tier that is proportionate to the scope and ambition of your activities and justify that selection through the detail and credibility of your activity plan. The evaluator’s question is: does this activity plan justify this grant amount?

Payment structure. The grant is paid in two tranches. A pre-financing payment — typically 80% — is made at project start. The remaining 20% is paid after the final report is approved. If the final report is approved in full, you receive 100% of the selected tier. If the NA judges that delivery was partial, the lump sum can be reduced proportionately or — in cases of significant non-delivery — withheld entirely.

No receipts — but evidence of delivery is essential. Because the lump sum is not based on actual costs, there are no receipts required for the grant itself. However, you must be able to demonstrate that the activities described in the approved application actually took place. Attendance lists, meeting minutes, output files, photos, email correspondence between partners and participant feedback forms are all forms of activity evidence. The NA can request this evidence at any time during or after the project period.

Choosing the right tier. The most common KA210 budget mistake is selecting the maximum tier (€60,000) by default rather than selecting the tier that genuinely reflects the scope of planned activities. Evaluators are explicitly asked to assess proportionality — whether the activities described justify the amount requested. A two-partner, 12-month project with three modest activities and one output does not justify €60,000. Build your activity plan first, estimate the realistic costs, then select the tier that fits. For a detailed guide see our post on Erasmus+ budget planning.

4. KA220 Budget Categories Explained

KA220 uses a hybrid budget model — a combination of unit costs for staff and travel, and real costs for subcontracting and equipment. The budget is built line by line in the application’s budget tool, distributed across work packages, and justified by the activity plan. The total grant is calculated automatically from your inputs.

Staff costs — unit costs by category and country. Staff time spent on project activities is the largest cost category in most KA220 budgets. It is calculated using predefined daily rates that vary by staff category (A1 senior manager through A7 administrative support) and by country. The formula is: working days × daily rate = staff cost for that partner on that work package. All staff costs must be supported by signed monthly timesheets that record the actual days worked on the project.

Travel costs — unit costs by distance band. Each transnational trip is budgeted individually using distance bands — from Band A (under 100km) to Band F (8,000km or more). The unit cost per trip is fixed by band and covers the full outward and return journey as one trip per participant. Train travel under 500km is expected in 2026 — flights for short distances should be justified in the activity description.

Individual support — unit costs by destination country. Accommodation and subsistence for transnational activities are funded through daily rates that vary by destination country. The rate covers all living costs per day including travel days. Higher-cost countries (Scandinavia, Netherlands) have higher rates; lower-cost countries (Balkans, Eastern Europe) have lower rates. Always use the rates from the current Programme Guide — they are updated annually.

Subcontracting — real costs. Services outsourced to third parties — translation, external evaluation, graphic design, web development — are funded as real costs up to the amount stated in the budget. Each subcontracted service must be justified as something that cannot reasonably be provided by the partner organisations themselves. The core intellectual work of the project cannot be subcontracted to a non-partner organisation. Invoices and contracts are required as evidence.

Equipment — real costs. Specific equipment directly necessary for project activities is eligible as a real cost, but only for the proportion of use attributable to the project. Standard office computers, printers and general IT infrastructure are not eligible. Equipment purchased solely for the project and clearly evidenced as necessary for a specific output is eligible — with invoices and a clear justification.

The WP1 management cap. Project management (WP1) is capped at 20% of the total project grant. This cap is enforced by the budget tool — if your WP1 staff day allocations produce a management cost above this threshold, the tool will flag it and block submission. Redistribute staff days into the implementation WPs before finalising. For full budget planning guidance see our KA220 guide.

5. KA1 Unit Costs Explained

KA1 uses a pure unit cost model — the grant is calculated automatically from the activity data you enter: participant numbers, trip distances, activity duration and destination country. There are no receipts for the unit cost categories. What you need to ensure is that the actual activity matches what was described — participant numbers, destination and duration must correspond to the approved plan.

Travel — distance bands. Funded per participant per trip using distance bands based on the distance from the participant’s home city to the activity venue. Band A covers up to 99km; Band F covers 8,000km or more. Most intra-European travel falls in Band B (100–499km) or Band C (500–1,999km). Travel is funded for each participant for the combined outward and return journey as one trip.

Individual support — daily rates. A daily rate per participant covering accommodation and subsistence for each day of the activity including travel days. The rate varies by destination country. This is typically the largest single cost category in a KA1 budget. It is funded for all eligible participants — learners, staff and group leaders as applicable to the activity type.

Organisational support. A lump sum covering the applicant organisation’s coordination costs — staff time for project management, communication, participant administration and reporting. The rate is calculated per activity. For KA122 short-term projects this is the primary overhead coverage mechanism.

Preparation costs. A unit cost per participant covering pre-departure preparation — cultural orientation, language preparation, safety briefings, non-formal learning methodology for group leaders. This category specifically funds the preparation phase of mobility activities and should not be treated as surplus.

Courses and training cap for KA122. For short-term KA1 projects (KA122), the total budget allocated to “Courses and training” activities is capped at 50% of the total awarded grant — with an exception for projects where the total grant is under €40,000, where the cap is €20,000. A project built entirely around training courses will hit this cap and cannot be compliant without adding other mobility types.

Inclusion support. Additional real costs available for participants with fewer opportunities — covering higher travel costs for remote locations, disability-related support needs or other specific barriers. Claimed as real costs up to a defined ceiling, with justification per participant.

6. Most Common Budget Mistakes

Using outdated unit cost rates. Unit cost rates for staff, travel and individual support are updated annually in the Programme Guide. Budgeting a KA220 project using 2025 rates when applying to the 2026 call will produce incorrect cost calculations — some rates increase, some decrease. Always download and use the Programme Guide for the specific call year you are applying to and verify every rate before finalising the budget.

Selecting the maximum KA210 lump sum without proportionate activities. Requesting €60,000 for a two-partner, 12-month project with two meetings and one modest output raises an immediate proportionality concern in evaluation. Evaluators are explicitly asked to assess whether the lump sum requested is proportionate to the activities described. Build your activity plan first and select the tier that fits — do not default to the maximum.

KA220 WP1 exceeding 20% of total grant. The project management work package cap of 20% is the most common KA220 budget error and is entirely preventable. Check the WP1 percentage in the budget tool before finalising. If it exceeds 20%, redistribute staff days from management activities into the relevant implementation work packages.

Subcontracting core project work in KA220. Subcontracting is designed for specialist services that the partner organisations cannot provide — translation, external evaluation, design. It is not designed to replace the core intellectual work of the project. An application where the main intellectual output is subcontracted to a third party not in the consortium will be queried by evaluators and may be assessed as a misuse of the subcontracting budget category.

Claiming double funding. The prohibition on double funding is absolute — the same cost cannot be claimed from two EU or national funding sources simultaneously. Organisations that receive multiple grants must maintain separate financial records for each project and ensure that no cost is attributed to more than one funding source. The NA cross-checks this during financial audits and monitoring visits.

Building the budget before the work plan. The most structurally damaging budget error is designing the budget independently of the work plan and then trying to make the two consistent afterwards. The correct sequence is always: define work packages → assign activities → assign participants and staff days per activity per partner → calculate costs from the unit rates. A budget that does not emerge from the work plan will contain inconsistencies that evaluators can identify and that create problems at the reporting stage.

7. Budget Checklist

• ✅ Correct budget model identified — lump sum (KA210), unit + real costs (KA220) or unit costs (KA1)
• ✅ Unit cost rates verified from the 2026 Programme Guide — not 2025 rates
• ✅ Budget built from the work plan — not designed independently and retrofitted
• ✅ For KA210: lump sum tier selected proportionately — activity plan justifies the amount requested
• ✅ For KA210: activity evidence collection plan in place — attendance lists, minutes, output files
• ✅ For KA220: staff days calculated per partner per work package using correct category rates
• ✅ For KA220: WP1 management cost does not exceed 20% of total grant
• ✅ For KA220: travel budgeted using distance bands — sustainable transport for under 500km
• ✅ For KA220: individual support rates verified for each destination country
• ✅ For KA220: subcontracting items justified as not deliverable by partner organisations internally
• ✅ For KA220: real cost items (subcontracting, equipment) have clear justification and invoicing plan
• ✅ For KA1: courses and training budget does not exceed 50% of total grant (KA122)
• ✅ No costs planned before the official project start date
• ✅ Double funding check completed — no costs claimed from another EU funding source
• ✅ VAT eligibility checked — only non-recoverable VAT claimed where applicable
• ✅ Budget and work plan cross-checked for full consistency — every activity has a budget line