1. what is a start-up grant?
If you become unemployed and cannot find a halfway adequate job, you can apply for government funding to start your own business. The subsidy is intended to make it easier for unemployed people to take the step into self-employment. However, the grant is linked to certain conditions. Only those who are aware of these and take the right steps at the right time can benefit fully from the funding instrument and apply for the start-up grant. The deadlines for submitting the application are particularly important here.
Current information on the start-up grant can also be found here: Gründungszuschuss 2.0.
What does "grant" mean?
Grant means that you get the money as a gift. You do not have to pay back the money - the start-up grant.
2 What is the purpose of the start-up grant?
The purpose of the start-up grant is to enable you to cover your living costs in the initial period of your self-employment and to provide you with social security (e.g. health insurance, etc.). Acquisitions and investments may not be financed from this.
From the point of view of the Federal Employment Agency, the goal is that you can permanently end your unemployment through your self-employment.
Therefore, the Federal Employment Agency attaches great importance to:
- the expert opinion on the viability of your business start-up
- the own examination by the Federal Employment Agency.
3. What is important when applying for the start-up grant?
You would like to become permanently free from drawing unemployment benefits through your self-employment. Is the payment of the start-up grant necessary for this?
You must explain to the Federal Employment Agency whether the start-up grant is necessary to secure your livelihood and your social security (according to § 93 SGB III).
The necessity of the start-up grant on the one hand and the proof of the viability of your self-employed activity on the other hand should be made comprehensible by the business plan you have to submit.
In order for you to be granted the start-up subsidy, the person in charge at the Federal Employment Agency needs a so-called sustainability certificate. This certificate serves as proof that your business start-up is viable, i.e. that you are likely to be able to finance your livelihood and social security (health insurance, etc.) yourself on a permanent basis through your business start-up without continuing to receive unemployment benefits.
The certificate of viability is sent by an expert body to the Federal Employment Agency. The expert body has the necessary expertise to assess whether your self-employment activity can generate profit so that your livelihood and social security are guaranteed.
4. starting up from unemployment
Unemployed persons who wish to apply for a start-up grant must have previously paid into the statutory unemployment insurance scheme for at least 12 months, i.e. they must have worked for at least one year in an activity that is subject to social insurance contributions. Appropriate proof of this must be provided. Only then are unemployed persons entitled to ALG I. Before applying for a start-up grant, the unemployed must have been entitled to ALG I for at least five months, i.e. around 150 days. Unemployed persons planning to become self-employed should use this time to prepare for their future activities, but must still be available to the primary labor market during this period.
5. state subsidies for the foundation
If the deadlines and conditions are consistently observed by the applicant when founding a company from unemployment, the unemployed founder can extend the duration of ALG I beyond the regular reference period of twelve months by six months. During this time, the founder receives his ALG I in the previous amount for another 6 months. These are subsidies in accordance with SGB III and are intended to help the future self-employed person through the difficult first months after founding the company and to facilitate entry into self-employment. The founder can thus cover his living expenses without having to fall back on savings. In addition to ALG I, the founder receives an additional 300 euros in social security contributions for 6 months.
After expiration of the support of 6 months there is another possibility to apply for support funds. The founder can still receive 300 euros per month for social security for another nine months. The contributions for the health insurance are thus secured for another nine months. Unlike unemployment benefit I, which is extended by six months, these additional nine months are not financed from the contributions of the statutory social insurance, but from tax revenues. The legal basis can be found accordingly in § 93 SGB III. Evidence must also be provided for this second application. The founder must be able to present the economic situation in tangible figures and show a perspective for the next 6 months, i.e. how his company will most likely develop.
6. nothing works without a business concept
The applicant should definitely work out a rough business concept for his future self-employment. This does not have to be a detailed business plan. It should nevertheless show that the founder will be able to live from his business, i.e. support himself, within 36 months at the latest. However, the first six months or the seventh month are particularly important. Here, the applicant must prove that the business is viable and that the founder can live from it. Surpluses must be proven in the figures. This is the entrepreneur's salary, which must enable the founder to live adequately. In addition to the planned figures of the business concept, the founder must provide a textual description of his project. This should comprise between 20 and 30 pages. The third part then comprises the enclosure package. In addition to the curriculum vitae and the business and tax registration, this also includes certificates of participation in a start-up seminar and the like.
In any case, the founder needs an expert opinion from a third party for the business concept. In a sense, it is the business plan for the start-up grant. Depending on the scope and level of detail, between 50 and 150 euros should be budgeted for the expert opinion. The expert opinion can be carried out by the IHK, a tax consultant or a management consultant. X-GROUP GmbH Institut für Gründung, Finanzierung und Geschäftsentwicklung in Berlin has a lot of experience in this field and has already issued opinions for hundreds of business concepts, of which over 90 percent have been approved.
7. applying for a start-up grant: You need these documents for the expert opinion.
In order to make the required assessment, the expert body will need various information and supporting documents from you:
- Your curriculum vitae and certificates, in order to be able to prove which professional knowledge and commercial skills you have already acquired
- information on what knowledge of your industry you already have
- Your business plan, in which you explain in more detail various aspects of yourself and your self-employment, including
- Your product or service and its unique selling proposition.
- Who you expect to be your customers
- What marketing measures you are planning
- What sales you expect
- How much profit you expect to generate
- How you plan to finance your business
- What prospects of success you see
Above all, the business plan will reveal the viability of your start-up.
8. What deadlines must the founder observe when applying for the start-up grant?
In order for the process to be successful, certain deadlines must be observed by the founder. Only after the unemployed person has received his ALG-I notice, he should become active in this direction. Not before. The Bezieher of ALG I after SGB III, must be available to the job market in principle. On it Daniel shepherd, managing director of the X-GROUP GmbH in Berlin points expressly out. The case worker of the agency for work is urged to submit constantly job offers to the unemployed person. The unemployed person must cooperate in the first 1 - 3 months after receipt of the decision with the work mediator, must furnish to this proofs over applications and refusals, before it can request the establishment subsidy. Only after this, i.e. after the first few months, can the employment mediator issue the forms for applying for start-up subsidies. At this point, it should be remembered once again that the applicant must still have at least 5 months of ALG-I receipt ahead of him/her when submitting the application. If this period has elapsed, it depends on the goodwill of the mediator whether the application is still permitted. In the worst case, the unemployed person is completely denied the application. The unemployed person then no longer has the possibility of receiving a start-up grant and - if he or she does not find a job during the reference period - will slide into ALG II, i.e. Hartz IV, after ALG I expires.