Child benefit – home support for families with children – kfw 424

Amount – requirements – application

The construction child benefit is a state subsidy for families with children who build or buy their first own property. No distinction is made between construction or purchase, nor between a house or a condominium. Since September 18, 2018, funding of up to EUR 12,000 per child has been legally decided.

In our guide you will find everything about the requirements, the application and the amount of the child benefit.

What is the construction child benefit?

At first, it seems unusual for the state to make families happy with a non-repayable grant. However, this support is intended to make it easier for families to finance their house or property. As part of a housing offensive, the child benefit was introduced by the grand coalition on September 18, 2018 and is used to finance construction for families. 12,000 euros per child are to be paid in 10 annual installments of 1200 euros each.

Successor to the homeowner allowance?

The procedure is reminiscent of the homeowner’s allowance paid for the first time in 1995. This government subsidy for homes and real estate was abolished again in 2005.

Requirements for child benefit

  • Purchase or construction a property in Germany from 01/01/2018.
  • selfuse the property for at least ten years without interruption.
  • It has to be one First purchase act without owning another property.
  • Families or single parents at least one child are authorised.
  • The living in the household Child is under 18 years and receives child benefit.
  • The taxable income is a maximum of 90,000 euros per year for a child
  • 105,000 euros / year with 2 children
  • 120,000 euros / year with 3 children
  • 135,000 euros / year with 4 children
  • 15,000 euros for each additional child / year

How much is the child benefit??

A family receives child benefit in the amount of 1,200 euros annually per child and that for ten years. In 10 years, 12,000 euros per child will be subsidized for the property they use themselves.

The construction child allowance grant amounts to 10 years in each case:

  • 12,000 euros for a child
  • 24,000 euros for two children
  • 36,000 euros for three children
  • 48,000 euros for four children
  • 12,000 euros for each additional child

Child benefit plus higher in Bavaria

In Bavaria there is the Bauchildergeld Plus. Here the annual allowance per child increases by another 300 euros. Responsible for the Bavarian child benefit is not the KfW but the Bavarian State Soil Credit Institution (BayernLabo).

How and where can I apply for child benefit??

  1. Registration or registration
  2. application and fill out all the necessary forms
  3. Receipt of receipt, if delivered on time.
  4. Prove identity: Either with videoident or postident procedure
  5. Upload evidence: Notices of income of second and third Year before the application, registration certificates of all people living in the household, extract from the land register (family must be at least 50% owner)

The most important data at a glance

Application period: The child benefit can be requested from 09/18/2018 until 12/31/2023.

Completion of purchase or building permit: However, the purchase or building permit must have taken place or been issued between August 1, 2019 and December 31, 2020.

Submission of the application: The application must be submitted to KfW no later than six months after moving in.

When is the construction child benefit paid out??

Since the application is processed by KFW Bank, the order confirmation is uploaded to the KfW grant portal when the processing is completed with the payment date. The state expects a high number of applications in a short time, which may lead to delays in the processing time.

Income limits – What income limits does the child benefit stipulate?

The total income of both parents must not exceed 75,000 euros plus 15,000 euros per child. With a child, the income limit is a maximum of 90,000 euros. With two children at 105,000 euros and with three children at 120,000 euros.

Important: Decisive for the calculation of household income is the average family income of the second and third year before the application. For 2018, this means that the average income from 2015 and 2016 is included in the calculation.

Which children are eligible for child benefit?

The child must apply under 18 years old and entitled to child benefit his. Likewise, only children who live in the same household count. There are no known restrictions on the number of children in a family for whom the allowance is paid.

Unborn children only count if they are born no later than three months after moving in.

How big can my new home or apartment be??

The size of the property purchased or built is completely irrelevant for the child benefit. The living space therefore does not affect the amount or entitlement to child benefit.

The child benefit must be taxed?

No, because the construction child benefit is a tax-free subsidy.

Use of payment

The child benefit increases the credit line by EUR 100 per child per month, but it cannot be counted against the equity in the construction loan.

Apply for construction child benefit retrospectively – that works?

The child benefit is only paid retrospectively as of January 1, 2018. An application for real estate that was acquired or built before this date is no longer possible retrospectively.

Legal right to child benefit

There is no legal claim. The child benefit is only paid out as long as funds are available. Unfortunately, this also means that those who come too late could go away empty-handed.

limitations & Criticism of child benefit

The decision of the grand coalition on child benefit brings relief for many families. Nevertheless, it is feared that it can lead to problems elsewhere:

  • The child benefit could lead to an increasing demand for building plots. As a result, property prices would continue to rise.
  • Low-income families could have problems with loan repayments after the child’s allowance ceases to exist.
  • Child benefit is only possible because there is a redistribution of tax money expenditure. Other areas could suffer.

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