Direct costs in accordance with the legislation include: – cost of purchasing raw materials and (or) materials used in the production of goods (performance of works and services), and (or) form the basis of either being a necessary component in the production of goods (works, services) – the cost of acquisition of components subjected to installation, and (or) semi-exposed to additional processing of the taxpayer – the cost of labor personnel involved in the production of goods, works and services, as well as the amount of the unified social tax and the cost of mandatory pension insurance, going to finance the insurance and funded part of pension accrued on those amounts of labor costs – the amount of depreciation on fixed assets used in the manufacture of goods, works and services. Indirect includes all other expenditures, excluding non-operating (Article 265 of the Tax Code). The organization has the right establish a list of direct expenses other than the one provided for in Art. 318 of the Tax Code. This list needs to be fixed in accounting policy (Letters from the Russian Ministry of Finance 11.11.2008 03-03-06/1/621, from 10.04.2008 03-03-06/2/267, from 28.03.2008 03-03 – 06/1/207, from 27.08.2007 03-03-06/1/597). In practice, some organizations, a question arises: is it possible to identify all the costs as an indirect and thus abandon the direct costs? In our opinion, this should not be, because the Tax Code clearly states that charges should divided into direct and indirect. Therefore, if the organization will take into account all the expenses only as indirect, the principle of separation of the Tax Code, will be disrupted.