Majority of people living in Germany are tenants, some willingly and others simply due to the high cost of acquiring a home. The coalition government has come up with, Baukindergeld a new grant to support families acquire or build their first home. In addition, the state of Bavaria not to be left behind introduced the Baukindergeld PLUS. In this article we look to understand what these are, who can, where and how to apply.
What is Baukindergeld?
Baukindergeld is a grant offered by the Federal government through the national development bank, Kreditanstalt für Wiederaufbau (KfW), to support families looking to acquire or build their first home which can be an apartment or a stand alone or semi-detached house. This application can be made for homes bought from January 1st 2018.
Who can apply?
Any individual that:
- has recently (co-)bought a residential property,
- is entitled to Kindergeld or lives in a household with someone who is entitled to Kindergeld for the child/ren living in the household
- has at least one child in their household, who at the time of the application is still a minor and is entitled to Kindergeld and
- has a maximum annual taxable income of 90,000 euros for the first child. The limit increases by 15,000 for every additional child. These children should be minors and be living in the same household
Baukindergeld is only available for homes whose :
- acquisition cost without the incidentals must be higher than the amount given by the Baukindergeld
- building permits (Baugenehmigungen) were issued between 1st January 2018 and 31st December 2020.
- notarised purchase agreements (notarielle Kaufvertrag) were signed between 1st January 2018 and 31st December 2020.
However, Baukindergeld cannot be used to finance:
- holiday homes
- a home that is anticipated to be inherited or a gift
- a home previously owned by a spouse or partner in any other form of permanent relationship, first grade relatives (e.g. children, parents, grandparents, great-grandparents)
- an additional home if you already own a residential property, even if the residential property currently owned is rented out
Applicants should have a maximum taxable household income of 90,000 euros, with the limit increasing by 15,000 euros for every additional child.
The household income is the sum of your income and that of your spouse living in the same house.
In this instance, they do not look at the gross income (Bruttogehalt) but the taxable income (versteuernde Einkommen), which is your gross income without the deductions, child allowance (Kinderfreibetrag) – if it is more favourable than Kindergeld and all other allowances.
Taxable income = Gross income – [Allowances + Tax Deductible Expenses]
From the taxable income, the following limits have been set:
|No. Of kids||Max. Taxable Income|
|1 Child||90,000 €|
|2 Children||105,000 €|
|3 Children||120,000 €|
In this application, the income considered is that of the 2nd and 3rd year before the application, so if your application is made in 2019, then the income considered will be that of 2016 and 2017.
How high is the Baukindergeld financing?
Baukindergeld offers middle-income parents €12,000 per child for ten years. However, applicants are expected to qualify to pay for the house without the Baukindergeld grant.
|No. Of kids||Baukindergeld Per year||Sum in 10 years|
|1 child||1,200 €||12,000 €|
|2 children||2,400 €||24,000 €|
|3 children||3,600 €||36,000 €|
What is Baukindergeld PLUS?
The Baukindergeld PLUS is an addition to the Baukindergeld for residents of Bavaria (Bayern). To qualify for Baukindergeld PLUS, one has to:
- qualify for Baukindergeld
- have lived in Bayern for at least one year
- have worked in Bayern for at least one year
The Baukindergeld PLUS enhances your Baukindergeld financing by 300 euros:
|No. Of kids||Baukindergeld Per year||Baukindergeld PLUS||Total per year||Sum in 10 years|
|1 child||1,200 €||300 €||1,500 €||15,000 €|
|2 children||2,400 €||600 €||3,000 €||30,000 €|
|3 children||3,600 €||900 €||4,500 €||45,000 €|
Some of the differences between Baukindergeld and Baukindergeld PLUS are:
|1||Set at €1,200 per child per annum||Set at €300 per child per annum|
|2||Only available to couples with minors still living at home||Also available to childless couples|
|3||Paid out by Kreditanstalt für Wiederaufbau (KfW)||Paid out by BayernLabo|
When and How to apply
The application must be handed in on the www.kfw.de/zuschussportal not more than 6 months AFTER moving into the new home (This applies to applications made after 17th May, before that it was 3 months.)
All members of the household should have moved in and registered the home address as their main or only residence (Haupt oder alleinigem Wohnsitz) .
More information on the application process, please check the KfW leaflet.
Applicants must hand in their application to BayernAbo.de/Baukindergeld no more than 3 months after getting the confirmation of disbursement of funds by KfW.
- Your local bank. Many banks are offering consultations on Baukindergeld and its suitability to your situation.
- The KfW has a hotline
- KfW website is also very resourceful kfw.de/Baukindergeld