The term ‘on-costs’ has suffered from a lack of clear and consistent definition in the industry. For example, depending on the client’s view and their accounting practices, on-costs can range from the bare minimum of design fees to the full range of the client’s costs associated with a particular project.

This section does not attempt to specify what should or should not be included in on-costs. Instead, it aims to identify the range of costs that might be included in a stated on-cost for a particular project. Actual practice will vary from client to client, but a defined checklist will help to clarify what is and is not included in a stated on-cost.

This section also proposes:

  • definition of construction costs
  • a list of additional costs that might be included in on-costs and
  • an indication of costs that relate to the client's use of the asset.

It is written in the context of allocating costs on a completed project. It refers to various rules of measurement and contract types in its treatment of the topic.

Related content

RICS standards: Cost prediction

RICS standards: Cost reporting

RICS standards: Life cycle costing