1. Quick overview: What is the Gründungszuschuss (start-up grant)?
The Gründungszuschuss is a state-supported start-up grant in Germany designed to help unemployed people who receive Unemployment Benefit I (ALG I) make the transition to self-employment. It is granted by the Agentur für Arbeit as a discretionary benefit and is aimed at helping founders cover living costs and basic social security while they establish a viable business.
In simple terms: if you still have at least 150 days of ALG I entitlement and you can prove a viable business idea, you may be eligible for a two-stage support package that eases the financial pressure in the crucial early months of your new venture.
2. Who is eligible — and who is excluded?
Eligibility is specific. Key requirements: you must currently receive ALG I, you must have at least 150 days of entitlement left at the time of application, and you must present a credible, sustainable business concept. The decision is made by the local Agentur für Arbeit.
Main exclusions and limitations
People who receive ALG II (Bürgergeld) are excluded. A direct switch from regular employment into self-employment without a period of unemployment is also not eligible. Self-inflicted unemployment—such as voluntarily resigning without good reason—can disqualify an applicant. The grant is not automatic and requires documented proof of economic viability.
3. How the funding works: amounts, phases, and conditions
The Gründungszuschuss is structured in two phases. The first phase lasts up to six months and combines the former ALG I payment with a flat social security supplement. A possible second phase of up to nine months provides only the flat supplement and requires additional evidence of the business’s viability.
| Phase | Duration | What you get | Conditions |
|---|---|---|---|
| Phase 1 | Up to 6 months | Remaining ALG I entitlement (full amount) + €300 monthly flat for social coverage | Must be unemployed with ≥150 days remaining; business idea must be plausible |
| Phase 2 (optional) | Up to 9 months | €300 monthly flat only | Requires proof of economic viability (business plan, IHK or certified advisor statement) |
| Decision is discretionary by the Agentur für Arbeit | |||
Note that the €300 monthly supplement is intended to cover part of social protection costs and remains contribution-free for health insurance. However, the ALG I portion you receive and any business profits are subject to social security and tax rules.
4. Social security, taxes and important 2026 changes
Several rules changed or took effect in 2026 that affect founders. The monthly minimum assessment base for the self-employed was raised to €1,318.33. The €300 flat-rate allowance remains contribution-free, but the ALG I portion and any profits are social insurance relevant and may lead to contributions.
Concrete example of health insurance impact
For instance, if you report a total monthly income of €1,700, a typical calculation at a contribution rate of 17.9% results in a health insurance contribution of about €304.30. This illustrates how quickly social contributions can reduce net cash flow and why careful planning is essential.
Other helpful tax and allowance changes in 2026
Positive changes that can ease founder burdens include a higher tax-free basic allowance (Grundfreibetrag) of €12,348 and an increased distance allowance (Entfernungspauschale) of €0.38 per kilometer counted from the first kilometer. These shifts can improve after-tax income for founders with certain personal circumstances.
5. How to apply and what documents to prepare
Applying for the Gründungszuschuss requires preparation. Start early, gather documentation, and get professional advice to maximize your chances. The Agentur für Arbeit evaluates each case individually.
Step-by-step application checklist
- Confirm ALG I entitlement and ensure at least 150 days remain.
- Draft a professional business plan that includes an income and sales forecast, a liquidity plan, and a risk analysis.
- Obtain a supporting statement from the IHK or a certified business advisor confirming the plausibility of your plan.
- Consider professional coaching (e.g., with an activation and placement voucher / AVGS) to strengthen your skills and plan presentation.
- Submit the full application and documentation to your local Agentur für Arbeit and be prepared to answer follow-up questions.
Recommended documents to include
- Detailed business plan with revenue forecast and liquidity planning
- Market analysis and customer acquisition strategy
- Cost plan and break-even analysis
- IHK or certified advisor statement on the business concept
- Proof of ALG I entitlement and current benefit statement
6. Risks, timing and practical tips to improve your chances
The Gründungszuschuss can be a decisive help, but it is not permanent and comes with risks. Funding rules may be tightened—reports warn of cuts around 2025/2026—and the real value of the €300 supplement can be reduced by rising reference amounts and contribution bases. Apply early and prepare carefully.
Practical tips
- Get professional coaching and use AVGS if available — it improves preparation and presentation.
- Prepare a robust business plan with realistic sales forecasts and a liquidity buffer.
- Secure independent confirmation from the IHK or a certified advisor to strengthen credibility.
- Run conservative contribution and tax simulations so you know your expected net cash flow (consider health insurance and social contributions).
- Apply as soon as you meet eligibility to avoid potential future funding cuts and to start building momentum for your business.
In short: the Gründungszuschuss is an important instrument for unemployed people wanting to become self-employed, but it requires solid preparation. Prioritize a credible business plan, professional advice, and early application to make the most of this support while it lasts.
