Start-Up Grants For The Unemployed (Gründungszuschuss)
In order to qualify for the “Gründungszuschus” (subsidy from the Agentur für Arbeit), you need to be officially unemployed for at least one day and you need to be entitled to get “Arbeitslosengeld I”. From the date of foundation on you need to be entitled to get “Arbeitslosengeld I” for another 150 days. No subsidies will be granted if you have received the grant within the last 24 months. There is no legal entitlement to such a subsidy.
The start-up grant is paid out in two phases: For the first six months – the applicant can receive a grant matching their last unemployment benefit to cover living expenses plus €300 a month for social insurance.
After the first 6 months, it is possible to apply for another 9 months. In this case, you receive only 300 Euro monthly for social security.
The „Gründungszuschuss“is exempt from taxation.
Any remaining claims for Arbeitslosengeld I are consumed by the Gründungszuschuss in the ratio 1:1.
The application must be submitted to your local labor office before setting up your business. The application must include your registration as a freelance contractor and a qualifications proof. The commercial viability of your business plan has to be confirmed by an expert institution. A business plan is required to ensure economical sustainability of your business idea.
Source: Hubatscheck, Bernd: "Existenzgründung", http://www.mkk-consult.de , retrieved December 2018.