Many people think of Wohngeld – the state housing allowance – as support for pensioners and families with children. In practice, self-employed people can also be entitled to it if their business income is still unstable or low. Here we explain how this allowance works, which business owners can count on it and how income is calculated for the self-employed.
What Wohngeld is
Wohngeld is a state allowance towards housing costs. It comes in two forms: Mietzuschuss – a rent subsidy for tenants – and Lastenzuschuss – a subsidy for people paying off a mortgage on a home they live in. The legal basis is the Housing Allowance Act (Wohngeldgesetz, WoGG). The decision is made by the local housing allowance office, usually part of the district or city administration.
Wohngeld is not a subsistence benefit like Bürgergeld (renamed Grundsicherungsgeld from 1 July 2026). It assumes that the household as a whole supports itself but needs additional help specifically with housing costs. This distinction is particularly important for people starting their own business who have an unstable income at first.
Which self-employed people can receive Wohngeld
In principle, the following can apply for Wohngeld: tenants and owners on a low income, employees on low wages, families and single parents, pensioners with a small pension, and students without entitlement to BAföG (student finance). This group expressly includes the self-employed and business owners whose business income does not fully cover their living and housing costs. There is no fixed income threshold – the calculation depends on the size of the household, the rent and total income; you can make a preliminary estimate of your chances with the official Wohngeldrechner (calculator) of your federal state.
People receiving Bürgergeld/Grundsicherungsgeld or Sozialhilfe under SGB II/XII generally cannot receive Wohngeld at the same time – because these benefits already include an amount for housing costs. In so-called “mixed households”, where only some family members receive such benefits, the calculation is made separately – only for those who are formally entitled to Wohngeld. Check your exact status in your specific situation with the relevant office.
For those who previously received the Gründungszuschuss (start-up grant when leaving ALG I) or Einstiegsgeld (a supplement to Bürgergeld/Grundsicherungsgeld under § 16b SGB II), there is no automatic exclusion from Wohngeld as there is with Bürgergeld – because these benefits do not generally cover housing costs. Whether you are entitled to Wohngeld in addition to them depends on your actual total income during the assessment period.
| Benefit | For whom | Covers housing? | Compatible with Wohngeld? |
|---|---|---|---|
| Bürgergeld / Grundsicherungsgeld (SGB II) | Recipients of basic income support who are able to work | Yes, including housing costs | No – § 7 WoGG |
| Einstiegsgeld (§ 16b SGB II) | Bürgergeld recipients starting a business | Indirectly, through the main benefit | Generally not, as long as Grundsicherung continues |
| Gründungszuschuss (§§ 93 f. SGB III) | ALG I recipients starting a business | No, a fixed supplement | Possible if total income is low enough |
| Wohngeld (Mietzuschuss/Lastenzuschuss) | Households on low to middle incomes, including the self-employed | Yes, a dedicated housing subsidy | – |
The Wohngeld Plus reform: the situation in 2026
The Wohngeld Plus reform has been in force since 1 January 2023 and significantly expanded the group of recipients. On 1 January 2025 the amounts were adjusted as part of the regular indexation carried out every two years. In most cases these values remain unchanged in 2026; the next scheduled indexation is set for 1 January 2027.
The reform has three elements: a general adjustment of the calculation formula, a permanent heating component (Heizkostenkomponente) to compensate for rising energy prices, and a climate component (Klimakomponente) that raises the maximum rent taken into account for energy-efficient or newly built housing. The exact amount depends on the size of the family, the rent level in the specific town (Mietstufe) and individual income – the most reliable way to determine it is the official Wohngeldrechner.
On 6 July 2026 the federal government approved a draft law which, from 2027, provides among other things for suspending the regular indexation and halving the heating component. According to reports on the legislative process, this could lead to some current recipients losing their entitlement. The draft is still before parliament and is not yet law – business owners who include Wohngeld in their financial calculations should follow developments on the BMWSB website or with the relevant office.
How the amount of Wohngeld is calculated
Three factors above all go into the calculation: the number of household members, the eligible rent including service charges excluding heating (Bruttokaltmiete) or mortgage payments for an owner-occupied home, and the total eligible income of all family members. Kindergeld and the Kinderzuschlag are not counted as income. The rent is taken into account only up to the statutory maximum for the relevant category (Mietstufe).
- Household size (number of people taken into account in the calculation)
- Bruttokaltmiete or mortgage payments, capped at the maximum for the Mietstufe
- Total income under § 14 WoGG, adjusted for statutory deductions and allowances
- Heating and climate components as fixed supplements
A special point for the self-employed: how income is assessed
Employees can usually prove their income easily with payslips. For the self-employed and business owners the situation is different: under § 15 WoGG, what matters is the expected income for the coming assessment period, not just the figures from the last tax return. What counts is profit according to tax law (§§ 2, 4 EStG), not turnover – business expenses reduce eligible income, while personal living costs or loan repayments do not.
With an irregular or seasonal income, the whole assessment period – usually twelve months – is generally considered in practice: weak and strong months balance each other out in the calculation. If you only show the office the months with low income, the assessment will be incomplete and may lead to errors in the decision.
- The latest tax assessment notice as a historical basis
- Current financial statements or a profit forecast for the assessment period
- Contracts, invoices or order confirmations as evidence of expected receipts
- Proof of business expenses
- Information on reserves or loans if current profit is low
Because a reliable forecast is often difficult for young companies, § 26a WoGG allows the allowance to be granted provisionally: Wohngeld is initially paid on the basis of estimated figures, and the final calculation is made later on the basis of the actual figures. If actual income differs significantly from the estimate, this may lead either to a back payment or to repayment of the amount overpaid. Under § 27 WoGG you must notify the office of any increase in income; failure to do so may have legal consequences. According to the case law of the administrative courts, simply transferring money already earned from the business account to your personal account (Privatentnahme) is generally not in itself considered additional income, as long as it only redistributes profit that has already been taken into account.
How to apply for Wohngeld: the typical procedure
You apply to the housing allowance office for your place of residence – usually at the district or city administration; in many federal states you can already apply online. The typical procedure is described below – the specific process may differ depending on the state and your individual situation.
- Find the office responsible for your place of residence and, if available, use the online Wohngeldrechner for a preliminary estimate.
- Fill in the application and gather proof of income, rent and household composition.
- If you are self-employed, also attach a profit forecast for the assessment period.
- Submit the application – as a rule, Wohngeld is paid from the month of application; it is generally not paid retrospectively for earlier months.
- Wait for the decision – it is usually valid for twelve months, after which you need to apply for an extension.
Common mistakes business owners make when applying for Wohngeld
- Wohngeld is mistakenly equated with Bürgergeld/Grundsicherungsgeld, so people do not even apply.
- Only months with low income are submitted as proof, rather than a forecast for the whole assessment period.
- The office is not informed of an increase in income in time, although this is a legal obligation.
- In mixed households, people overlook the fact that only the part of the family entitled to Wohngeld is included in the calculation.
- The extension application is submitted only after the current period has ended, creating a gap in payments.
Frequently asked questions
Can a new business owner receive Wohngeld in the first year of business?
Does turnover or profit count for the calculation?
Can I receive Wohngeld together with the Gründungszuschuss?
For how long is a Wohngeld decision issued?
Will Wohngeld change in 2027?
Wohngeld, Gründungszuschuss, Einstiegsgeld – which combination suits your situation depends on many individual factors. If you want to understand how these support measures fit together when starting a business in Germany, you can book a personal consultation or join one of Vitavia Akademie’s education programmes. Together we can look at your situation and help you avoid costly mistakes.
Book a consultationLegal notice: This article is for general information and educational purposes only and does not replace individual legal, tax or financial advice. Legislation and administrative practice – including on Wohngeld – may change; the amounts, deadlines and procedures given here are based on sources available at the time of writing and may differ in a specific case. Everyone’s situation is different. Before making important decisions, check the current information with the relevant office and, if necessary, consult a qualified professional. See also: Impressum and Datenschutz.
Sources
- Bundesministerium für Wohnen, Stadtentwicklung und Bauwesen (BMWSB): Wohngeld-Plus – bmwsb.bund.de
- Wohngeldgesetz (WoGG), §§ 7, 12, 14, 15, 17, 19, 26a, 27, 37 – gesetze-im-internet.de
- BMWSB: draft Wohngeld amendment 2026 (as of June–July 2026)
- Bundesagentur für Arbeit: Gründungszuschuss, Einstiegsgeld – arbeitsagentur.de
- wohngeld.org: overview of the Wohngeldgesetz and household composition
