Horizon Europe Grants: What Your Company Pays, Receives and When

Horizon Europe grants pay a company 100% of its eligible costs in a Research and Innovation Action and 70% in an Innovation Action, plus 25% for indirect costs. The money arrives in stages, through your consortium's coordinator. In one 2023 cybersecurity call, a funded project started 11 months after the deadline.

A Horizon Europe grant is an EU contribution towards the eligible costs each partner incurs on a collaborative research and innovation project. It is paid under a grant agreement with the European Commission or one of its executive agencies. This guide covers what your company funds itself, when each payment lands, what lump sums change and where the Forschungszulage, Germany's research allowance, fits.

How much of your costs does a Horizon Europe grant cover?

The Horizon Europe funding rate depends on the type of action named in the call. Research and Innovation Actions (RIA) and Coordination and Support Actions (CSA) pay up to 100% of eligible costs. Innovation Actions (IA) pay 70% to profit-making companies and up to 100% to non-profit legal entities. The Work Programme 2026-2027 General Annexes set these rates, and a 25% flat rate for indirect costs comes on top.

Source: European Commission, maximum Horizon Europe funding rates (PDF), Work Programme 2026-2027 General Annexes, Annex G, adopted 11 December 2025.

The rate applies to each beneficiary separately. A university in your Innovation Action can be funded at 100% while your company sits at 70% on the same project. The figure your board needs is your own share, at your own rate. Our SME funding service combines that share with national programmes in one plan.

Indirect costs are covered by a flat rate of 25% of your eligible direct costs. Subcontracting and financial support to third parties are left out of that base. Where a call uses lump sums, the funding rate is already built into the fixed amount and does not appear in the grant agreement.

The call text fixes the action type, so check it before you model a budget. For how calls sit inside the programme, see our guide to the Horizon Europe structure of pillars and clusters.

What your company has to fund itself

In an Innovation Action, your company funds 30% of its own eligible costs for the whole project. Budget for that share from the start. An actual-cost grant reimburses only costs actually incurred, never the budget you submitted, and some costs are not eligible at all.

Under the Horizon Europe Model Grant Agreement (PDF) and the Work Programme's General Annexes, the grant pays nothing towards:

• proposal preparation, because costs count only if incurred during the action period
• deductible or refundable VAT (non-deductible VAT is eligible)
• interest owed, debt service, dividends and return on capital
• currency exchange losses and bank charges on transfers from the granting authority
• any cost already declared to another EU grant
• profit, because a Horizon Europe grant may not produce one and any profit is deducted from the final grant

Proposal effort is real money. An EC evaluation support study published in August 2024 found that the median coordinator spent 36 to 45 person-days (PDF) on proposal preparation and the median partner 16 to 25. The European Commission's 2025 interim evaluation puts the average Horizon Europe success rate at 16.4%, so most of that effort goes into proposals that are not funded.

Personnel costs follow a fixed formula in the Model Grant Agreement: annual personnel costs divided by 215, multiplied by the days worked on the project. Nobody can declare more than 215 days a year across all EU grants. SME owners who draw no salary declare their time as unit costs instead.

Our case of Horizon Europe funding for a deep-tech project shows the scale for a company partner. The company took a defined work package built around its technology inside a multi-country consortium. Its funded share came to about €1.2 million over the project, mostly covering the personnel on its contribution. BeFunded's case figures are anonymised and shown as orders of magnitude.

If a 30% own share is too heavy for your balance sheet, compare the other EU funding programmes for companies before you commit.

How long from call deadline to first payment?

The first Horizon Europe payment arrives no sooner than about 8 months after the call deadline. Under the Work Programme 2026-2027 General Annexes, applicants learn the evaluation result about 5 months after the deadline and sign the grant agreement about 8 months after it. The Horizon Europe Regulation limits this time to grant to 8 months from the final submission date, unless there is a duly justified reason.

No pre-financing arrives before the grant agreement is in force. Under the Model Grant Agreement, initial pre-financing is due 30 days after entry into force or 10 days before the project start date, whichever is later. The start date normally follows signature and cannot be earlier than the submission date, except in justified cases.

CONSENTIS shows the timeline in practice. It is an Innovation Action on identity and consent management, coordinated by AEGIS IT Research GmbH, an SME in Braunschweig.

Sources: European Research Executive Agency, call deadline and 247 proposals; CORDIS, CONSENTIS project dates, updated 4 September 2026. Elapsed times calculated by BeFunded.

According to CORDIS, AEGIS IT Research received a net EU contribution of €597,726.90, out of a total EU contribution of €3,998,855.36 shared by 12 organisations from 9 countries. Signature alone took more than 7 months, and the project started 11 months after the deadline. Plan your runway from the call deadline.

The Horizon Europe programme guide sets out the full route from finding a call to signing.

How Horizon Europe grants are paid out

Horizon Europe grants are paid in three stages: pre-financing at the start, interim payments after each reporting period and a final payment at the end. The European Commission pays every instalment to the coordinator. Under the Model Grant Agreement, the coordinator must pass payments on to the other partners without unjustified delay and cannot delegate that task.

1. Pre-financing. Normally 160% of the average EU funding per reporting period (PDF), according to a European Commission helpdesk answer published by the Czech National Contact Point in 2024. The average is the maximum grant amount divided by the number of periods. Projects with a single reporting period receive less.
2. Mutual Insurance Mechanism. According to FFG, Austria's national research funding agency, 5% to 8% of the maximum grant amount is deducted from pre-financing and paid into the Mutual Insurance Mechanism (MIM). The MIM is a shared fund that covers debts the Commission cannot recover.
3. Interim payments. After each reporting period, the consortium has 60 days to submit a periodic report, and the Commission pays within 90 days of receiving it. Interim payments stop at 90% of the maximum grant amount, as the German EU liaison office KoWi explains.
4. Final payment. After the final report, the Commission pays the balance within 90 days and releases the MIM contribution.

Sources: European Commission, Horizon Europe Model Grant Agreement, Data Sheet 4.2; KoWi, payment modalities.

Read the consortium agreement's payment clauses before you sign, because the consortium agreement can redistribute EU funding between partners. Each beneficiary is liable only for its own debts. If any consortium member owes money to the EU, payments are automatically lowered to offset that debt. If the Commission pays late, it owes interest at the ECB rate plus 3.5%.

Lump sum Horizon Europe grants: what changes for your cash flow?

A lump sum Horizon Europe grant is fixed in the grant agreement up front and paid on completion of each work package, whether or not the research succeeds. The model now covers a large share of calls. In the European Commission's Work Programme 2026-2027, 50% of the call budget (PDF) runs on lump sums, particularly for topics meant to produce grants below €10 million.

Sources: European Commission, Work Programme 2026-2027 General Annexes; EU Funding & Tenders Portal.

Lump sums move the risk from accounting to delivery. The detailed budget table in your proposal must still meet actual-cost eligibility rules. If it contains ineligible costs, the grant can be reduced, even after the project ends. Moving money between lump-sum budget categories always needs a formal amendment.

Evaluators also compare your personnel costs with a Commission dashboard of average monthly personnel costs (PDF) by country and organisation type. Higher rates must be justified.

The European Commission presents lump sums as simplification. The €14 billion Work Programme was adopted on 11 December 2025. At the time, Ekaterina Zaharieva, Commissioner for Startups, Research and Innovation, said Horizon Europe had been made “simpler and more accessible to SMEs, start-ups and newcomers”. For a company, lighter reporting comes with a firm duty to finish each work package as written.

Checks before you sign the grant agreement

An invitation to grant preparation is not yet a funding commitment. Legal entity validation, a financial capacity check and an exclusion check still come first, and the financial check can change how your company is paid.

• PIC registration. Every beneficiary registers in the Participant Register for a Participant Identification Code (PIC) before applying. Validation happens during grant preparation, so you can submit without it.
• Financial capacity. Under the 2026-2027 General Annexes, the check normally applies to the coordinator when the requested grant is €500,000 or more. If the result is unsatisfactory, pre-financing can be paid in instalments or not at all, or the applicant can be replaced.
• Audit certificate. The Model Grant Agreement requires a Certificate on the Financial Statements (CFS) only at the final payment, and only for a requested EU contribution of €430,000 or more.
• Records. Keep project records for 5 years after the final payment. Audits can take place up to 2 years after it.

Can you combine Horizon Europe with the Forschungszulage?

Yes, with a limit on costs. Section 7 of the Forschungszulagengesetz (FZulG), Germany's research allowance act, allows the Forschungszulage alongside other funding for the same R&D project. Under Section 7(2), expenses funded by other aid cannot enter the assessment basis, EU money included.

The grant agreement adds a rule from the EU side: costs declared to one EU grant are ineligible under another. The open question is your 30% own share in an Innovation Action, the part the Horizon Europe grant does not reimburse. Check where the line falls project by project before you file, ideally with research allowance consulting support.

For the rates and caps behind the German instrument, see our guide to the research allowance in Germany.

BeFunded's Horizon Europe funding consulting starts with the number this article is about: your company's own share. We check the open topics against your project and confirm whether the call is a Research and Innovation Action at 100% or an Innovation Action at 70%. Then we give you a realistic figure before you commit time.

After that, we write the technical and impact case, keep the consortium paperwork together, submit through the Funding & Tenders Portal and prepare the reporting that releases each payment. The fee is success-based.

This article explains general rules and is not legal, tax or financial advice. Check the call conditions and your grant agreement, or speak to an adviser, before you commit budget.