9 Costs That Count as In-Country Value and 7 That Do Not
If your finance team has ever pulled a cost report for ICV certification and guessed at what qualifies, you’re not alone. Most companies get the big categories right, third-party spend, salaries, assets, and then lose points on the details that separate a competitive score from an average one. This guide walks through exactly which costs MoIAT counts, which it excludes, and where each one has to land in the ICV template.
Key Takeaways
- Third-party spend counts at the vendor’s ICV percentage, but mainland UAE vendors now get an automatic 10% floor even without a certificate – the zero score is reserved for non-mainland, uncertified vendors.
- Utilities and rent carry an 80% deemed rate. Fuel and telecom do not – both score at the actual ICV% of the provider.
- Emirati and expat salaries only count when paid through the Wage Protection System (WPS); anything outside WPS is capped at 10% of total salary.
- Sponsorship fees, government fines, taxes, and CSR/charity spend are all excluded from the cost base entirely.
- The score itself isn’t one formula – it’s six weighted attributes, and getting a cost into the wrong one costs you points even if it “counts.”
Curious where your own numbers land? Run them through the ADEPTS ICV Score Calculator before you read further – it’ll make the next few sections a lot more concrete.
The Six Attribute ICV Formula
Here’s the part most guides skip. What is ICV certificate scoring actually built on? Not a single equation. The MoIAT ICV formula is six separately weighted attributes: Third Party Spend / Manufacturing Cost (50%), Investment (25%), Emiratization (15%), Expat Contribution (10%), an ICV Bonus (up to 5%), and an Advanced Technology & Sustainability Bonus (up to 6% for Goods Manufacturers, 3% for Service Providers).
The calculation most companies already know, vendor spend weighted by ICV percentage, plus Emirati cost, plus 60% of expat cost, divided by total cost, is real. It’s just one piece. It’s the formula for the 50%-weighted Third Party Spend attribute, not the whole score.
Where does the ITTI bonus fit, then? Inside the Advanced Technology & Sustainability Bonus, worth up to 5 of a possible 6 points, and only for Goods Manufacturers.
9 Costs that Count as ICV
Here, in this section, we are going to reveal 9 ambiguous costs that count as ICV:
1 and 2. Third-Party Spend at the Vendor's ICV Percentage, and UAE-Manufacturer Purchases at 100%
Purchases from a certified UAE manufacturer count at 100% ICV. No qualifiers there. Services and agency spend work differently, and this is where the zero rule gets misunderstood.
An uncertified vendor doesn’t automatically score zero. If that vendor is registered on the UAE mainland, it gets an automatic 10% ICV floor, even with zero paperwork. The zero score is reserved for vendors that are both non-mainland and uncertified: free zone companies and foreign suppliers with no ICV certificate.
One more distinction worth keeping straight: this mainland-10%/zero rule sits in the Third Party Spend tab, which applies to Service Providers. Goods Manufacturers pricing a UAE service vendor inside their own Manufacturing Cost tab use a different rule entirely, 50% or the vendor’s actual ICV%, whichever is higher. Never zero.
3. Utilities, Fuel, Rent and Government Fees - At Different Deemed Percentages, Not One Flat Rate
This is where a lot of cost sheets go wrong. Water and electricity, rent paid to individuals or companies, and local farmer payments all carry an 80% deemed rate. UAE government charges and payments to government free zone authorities score at 100%.
Fuel and telecom are the trap. Neither one gets a deemed percentage. Both are scored at the actual ICV% of the specific provider, Etisalat, du, or your fuel supplier’s own certified score, whatever that happens to be. Don’t assume a flat rate for your phone bill the way you would for DEWA or SEWA.
4. Depreciation and Amortisation of Assets at 100%
Confirmed at full ICV value, with one caveat. If the underlying asset itself is excluded from the cost base, its depreciation carries the same exclusion. You can’t recover the ICV value through depreciation on an asset that never qualified in the first place.
5. Net Book Value of UAE Assets, Including Investment Property
Eligible asset classes here are Property, Plant & Equipment, capital work-in-progress, and investment property. This feeds the Investment attribute at a 10% weighting on the ratio of UAE asset NBV to total asset NBV, plus a progressive growth bonus of up to 15% on NBV growth between AED 5 million and AED 150 million.
Two exclusions worth flagging. Assets registered in the name of an owner or a related party are stripped out of this pool entirely, before the ratio is even calculated. And for intangibles, only capitalised software costs are eligible – goodwill, licences, and every other intangible asset are excluded. Investment property is its own eligible tangible category; it isn’t a type of intangible, despite how the two sometimes get grouped in internal cost sheets.
6 and 7. Emirati Salary Through WPS, and Expat Salary at Reduced Weighting
Emirati salary and benefits don’t count “in full”, that’s a common misread of the rule. Only salary and benefits paid through the Wage Protection System (WPS) count. Anything paid outside WPS is capped at 10% of total salary. If you’re the owner, your own WPS salary is capped at AED 200,000 per month, and owner bonuses are excluded entirely, no matter how the paperwork is structured.
Expat salary feeds the core Third Party Spend formula at a 60% weighting, and is separately scored under the Expat Contribution attribute, banded by expat headcount, from 1-3% for 1 to 5 employees up to 10% for 200-plus.
8 and 9. External Training and Emiratisation Benefits Outside Payroll
External training delivered to direct staff counts toward your score. Internal, in-house training does not, that distinction hasn’t changed. Donations are trickier than most companies assume. To count, a donation has to be monetary, at least AED 120,000, and paid to one of a named list of bodies: Sondoq Al Watan, Ma’an, the National Academy for Childhood Development, or specific government universities. Not every donation qualifies, and in-kind contributions never do.
7 Costs that Don’t Count
Now, we’ll bring forward 7 costs that don’t count as ICV but are confused with other factors sometimes:
1 and 2: Sponsorship Fees and Government Penalties
Both of these are confirmed excluded and grouped together in MoIAT’s own text with taxes, board-of-director management fees, and CSR or charity spend. Taxes aren’t a separate line item; they sit in the same exclusion bucket as fines and penalties.
3. Internally Delivered Training
No change here. In-house training stays excluded, matching the flip side of item 8 above. It has always been non ICV and still stays the same.
4 and 5. Investment Held Outside the UAE, and Most Intangible Assets
Only assets located inside the UAE feed the Investment attribute’s 10%-weighted NBV ratio. Anything outside the country is excluded outright. On intangibles: the eligible category is narrow, capitalised software costs only. Goodwill, licences, and every other intangible asset are excluded from the cost base.
6 and 7. Revaluation Uplift on PP&E, and Related Party Costs
Where Property, Plant & Equipment has been revalued, the net book value used in the calculation is reduced by the revaluation reserve balance first. And related party costs are excluded in two specific forms only: management fees paid to board-of-director members, and assets registered in the name of an owner or related party.
What the guidelines don’t address is a related party acting purely as a conduit for a genuine third-party supplier’s spend, a pass-through arrangement. That scenario isn’t covered in the current text either way, so treat it as unresolved and get a certifying body’s confirmation before you book it either way.
A Few More Exclusions Worth Knowing
Beyond the standard list, three exclusions show up in the September 2025 guidelines that rarely make it into cost checklists:
- loss on disposal of assets
- foreign exchange losses
- charity or CSR spend as its own standalone exclusion completely separate from the sponsorship-fee point above.
Bonuses paid outside WPS, once they exceed 10% of salary, are excluded the same way regardless of whether the employee is Emirati or expat.
Where the Two Lists Meet the ICV Template
Every cost above needs to land in the right attribute, not just the right “counts or doesn’t” column. Third-party spend and manufacturer purchases go into the 50%-weighted Third Party Spend or Manufacturing Cost tab.
Asset NBV and eligible intangibles feed the 25%-weighted Investment attribute. Emirati payroll sits under Emiratization at 15%, expat payroll under Expat Contribution at 10%. The ICV Bonus and the Advanced Technology & Sustainability Bonus, where ITTI actually lives , sit outside the core cost calculation entirely, as separate bonus inputs.
Reconciling this back to your audited accounts matters more than it used to. Since January 1, 2025, MoIAT requires standalone audited financial statements for the exact entity being certified – bifurcated accounts pulled from a parent’s consolidated statements are no longer accepted. Certificates stay valid for 14 months from the date the audited financials were issued, and those financials can’t be older than two years.
A company under 10 months old can use management accounts covering up to nine months instead. Run your numbers through the ADEPTS ICV Score Calculator once your cost base is reconciled, it’s a faster way to catch a misclassified line than working through the template by hand.
How ADEPTS Classifies a Cost Base for ICV
Getting the eligibility list right is one thing. Mapping fifty or a hundred cost lines against six weighted attributes, correctly, on a tight audit deadline, is not something most businesses will be able to do with expert assistance. That’s usually where things go wrong, not because a finance team doesn’t know the rules, but because nobody has the time to check every deemed rate and every WPS record against a 2025 update mid-audit.
ADEPTS handles this end to end:
- Full cost base classification against the current MoIAT guidelines, attribute by attribute
- WPS record verification for Emirati and expat salary before it’s booked
- Standalone audited financial statement preparation that meets the January 2025 entity-specific requirement
- Reconciliation of the classified cost base into the ICV template ahead of certifying-body submission
With ADEPTS, you’re not guessing which deemed rate applies to your utility bill. You’re submitting a cost base someone has already checked against the current rules. For smooth ICV calculation, run the number through ADEPTS ICV Calculator.
Start Smart, Score Higher
Cost eligibility for ICV certification isn’t static – the rules shifted meaningfully between the 2023 guidelines and the September 2025 version, and a cost sheet built on the older assumptions will underscore or overscore in ways an auditor will catch. Getting each line into the right attribute, at the right weighting, is what actually moves your score.
You don’t need to memorize six attributes and a dozen deemed rates to get this right. You need a cost base someone has checked. ADEPTS can classify yours before your next certification cycle, so nothing gets flagged after the fact.
| Cost Item | Counts? | Weighting/Rate | Template Section | Evidence Needed |
| Manufacturer purchases | Yes | 100% | Third Party Spend / Manufacturing Cost | Vendor ICV certificate |
| Mainland vendor, uncertified | Partial | 10% floor | Third Party Spend | Trade license (mainland) |
| Non-mainland, uncertified vendor | No | 0% | — | — |
| Utilities/rent/local farmers | Yes | 80% deemed | Third Party Spend | Invoices |
| Fuel and telecom | Yes | Provider’s actual ICV% | Third Party Spend | Provider ICV certificate |
| Government fees | Yes | 100% | Third Party Spend | Government invoice |
| Depreciation (eligible assets) | Yes | 100% | Investment | Fixed asset register |
| UAE asset NBV (PP&E, CWIP, investment property) | Yes | 10% weight + growth bonus | Investment | Audited financials |
| Owner/related-party-titled assets | No | Excluded | — | — |
| Capitalised software | Yes | Included in Investment pool | Investment | Audited financials |
| Other intangibles (goodwill, licences) | No | Excluded | — | — |
| Emirati salary via WPS | Yes | Emiratization scale | Emiratization | WPS records, Emirates ID |
| Salary outside WPS | Capped | 10% of total | Emiratization | Payroll records |
| Owner WPS salary | Capped | AED 200,000/month | Emiratization | WPS records |
| Expat salary | Yes | 60% weight + headcount band | Third Party Spend + Expat Contribution | Payroll, visa records |
| External training (direct staff) | Yes | Counted | Emiratization | Training invoices |
| Internal training | No | Excluded | — | — |
| Qualifying donations | Yes | If ≥ AED 120,000, named recipient | Emiratization | Donation receipt |
| Sponsorship, fines, taxes, CSR/charity | No | Excluded | — | — |
| Investment outside UAE | No | Excluded | — | — |
| Revaluation uplift on PP&E | No | Deducted before calculation | — | Revaluation reserve schedule |
| Board management fees | No | Excluded | — | — |
| Loss on disposal / FX losses | No | Excluded | — | — |
FAQs
An ICV certificate is valid for 14 months from the date the audited financial statements were issued, not from the certification date itself.
Not always. A free zone vendor scores zero only if it’s also uncertified. A free zone vendor holding a valid ICV certificate is scored at that certified percentage, same as any other vendor.
Branch spend generally follows the parent entity’s classification, but allocation between head office and branch needs to match the standalone audited financials required from 2025 onward. See our branch audit guide for the full breakdown.
No. Taxes are grouped with government fines and penalties as an explicit exclusion from the ICV cost base.
No. The Investment attribute is based on net book value of owned assets — PP&E, capital work-in-progress, and investment property. Leased assets don’t carry an NBV on your books the same way, so they don’t feed this ratio.
Seconded employee costs need individual review against WPS registration and the entity actually bearing the payroll cost — this is one of the edge cases worth confirming with your certifying body before filing.
Some of it can. The explicit exclusions are narrow — board management fees and owner/related-party-titled assets. A related party acting as a genuine reseller of third-party spend isn’t directly addressed in the current guidelines, so get written confirmation before treating it as included.
The 80% deemed rate applies to water, electricity, rent, and local farmer payments regardless of emirate. Fuel and telecom are never deemed — they’re always scored at the provider’s actual ICV percentage.
Only if they meet the definition of capitalised software costs. Other capitalised development costs outside that narrow category fall under the general intangibles exclusion.
Head office costs need a documented, defensible allocation basis before they can support a branch’s ICV score, and this ties directly into the standalone audited financials requirement effective from January 2025.
References
- Ministry of Human Resources and Emiratisation (MOHRE). “Wage Protection System.” MOHRE. Accessed September 19, 2026. https://www.mohre.gov.ae.
- Ministry of Industry and Advanced Technology (MoIAT). “ICV Formula.” MoIAT. Accessed September 19, 2026. https://moiat.gov.ae/en/programs/icv-formula.
- Ministry of Industry and Advanced Technology (MoIAT). “ICV Supplier Certification Guidelines, October 2023.” MoIAT. Accessed September 19, 2026. https://moiat.gov.ae/-/media/site/moiat/programs/icv-formula/icv-supplier-certification-guidelines-oct-2023.ashx.
- Ministry of Industry and Advanced Technology (MoIAT). “ICV Supplier Certification Guidelines, September 2025, v1.” MoIAT. Accessed September 19, 2026. https://moiat.gov.ae/-/media/site/moiat/programs/icv-formula/icv-supplier-certification-guidelines-sep-2025-v1.ashx.
- Ministry of Industry and Advanced Technology (MoIAT). “ITTI Incorporated into the ICV Program.” MoIAT, March 20, 2023. https://moiat.gov.ae/en/media-center/news/2023/03/20/icv-itti.
- Ministry of Industry and Advanced Technology (MoIAT). “National ICV Open Data.” MoIAT. Accessed September 19, 2026. https://moiat.gov.ae/en/open-data/national-icv.
- Ministry of Industry and Advanced Technology (MoIAT). “National In-Country Value Program.” MoIAT. Accessed September 19, 2026. https://moiat.gov.ae/en/programs/icv.
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