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Overhead Recovery and Markup Revenue

In order to recover overhead costs that UCLA incurs, the rate charged to External Customers must be, at a minimum, the Breakeven Rate plus the Overhead Recovery. The department may charge an additional mark-up to External Customers in order to provide services at market rates.

External Rate = Breakeven Rate + Overhead Recovery + Mark-up

The current approved overhead recovery rate is 39%.

The overhead recovery rate will not be implemented automatically when the updated Policy 340 is effective. All Sales and Service funds will go through a review over the next year or two, the Sales and Service office will work with department to determine the implementation process of the overhead recovery rate. For approved Sales and Service funds and Business Contract funds with Overhead (OH) and Markup (MU), please refer to User Guide and Transfer Form. Due to COVID-19 pandemic, the implementation timeline of the Overhead and Markup transfer will be announced later.