Indirect costs

Costs which traditionally cannot be allocated to individual building sites are referred to as indirect costs. These can include:

• Indirect material costs
• Indirect production costs
• Costs relating to company pension schemes
• Voluntary welfare payments
• General administration expenses
• Interest on debt capital

Paragraph 255 of the German Commercial Code (HGB) includes various capitalization options for indirect costs when calculating the costs of manufacture for construction work, as well as prohibiting the inclusion of sales-related expenses.