German Residence Permit for Self-employment
German residence permit for self-employment
To obtain a residence permit as a self-employed entrepreneur, you do not need to invest large capital in the local economy or hire at least five German employees. It is enough to present a well-thought-out business plan that will demonstrate that the planned activity is of interest and benefit to Germany. It is also important to have enough money for business development.
This way of moving to Germany is suitable for those who have really decided to settle in Germany, run their own business in this country, or choose a long-term prospective start up. In return you get free education for children, opportunity to obtain permanent residence and citizenship, and a chance for state subsidies and freedom of movement within the EU countries.
Program's details
- From €100,000 Initial capital for a family
- The main thing is to protect the business plan Without hiring employees
- Government subsidies IT, eco-technologies, undeveloped regions
- Loans With a low rate of 1.1%
- For the whole family spouses and minor children
- Free education In schools and universities for children
- Visa-free travel opportunities within Schengen countries
- German citizenship In 7 years
The official website of the program
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About the Program
Paragraph 21 of the Aliens Act (§ 21 AufenthaltsG) states that a long-term residence permit can be obtained by an entrepreneur whose activities:
- are of interest to the German economy or a specific region;
- positively affect the economic situation in the country;
- have good financing: an approved loan or own funds.
There are no universal requirements for the hiring of workers, the type of business, and the size of turnover. Each region decides for itself which project is interesting to it. The law states that the applicant must have “sufficient capital” for development. The specific amounts have not been determined, but, according to the experience of legal practice, the start is from € 100 thousand per family.
The main task of an entrepreneur is to prepare a well thought out business plan and to protect it, which means to convince officials that the project will be useful for the region. By promising to hire local staff, the said above protection may be avoided.
The following factors increase the chances of success: previous experience in entrepreneurship, promotion of innovations, starting a business in undeveloped regions, an impressive size of the authorized capital.
The term of a residence permit based on entrepreneurial activity is three years. In case of successful implementation of the business plan and sufficient income for the family, you can then get a permanent residence permit. If the economic indicators "fall far short", permanent residence is issued five years after passing the language exam. The right to apply for citizenship appears after seven years of continuous stay in the country with a residence permit and a permanent residence permit.
Conditions for obtaining a residence permit
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To defend business plan
The plan should indicate the sustainability and usefulness of the business idea, the applicant's entrepreneurial experience, sources and means of financing, the company's impact on the situation in the region (especially on tax revenues and employment), the use of new technologies.
It is possible to provide information on an approved long-term loan covering a part or the whole amount of the authorized capital.
When registering the most popular form of enterprise in Germany (GmbH), the authorized capital should be at least € 25 thousand, and 50% should be paid at the stage of company registration.
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To have resources for living and business
The applicant must demonstrate sufficient capital to start a business and live in Germany. According to the experience of lawyers, it is worth focusing on the amount of €100,000. Moreover, the total family budget is taken into account.
You must have residential real estate in Germany. It is not necessary to own it - a long-term lease agreement will do.
You need to have a health insurance policy.
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Requirements for the Applicants
Adult citizens of any country can apply for a German residence permit for self-employment. At the same time, education and experience must correspond to the field of activity that the investor claims. Knowledge of German is an advantage.
A residence permit is issued to foreigners over 45 years old only in case of sufficient pension provision (can be confirmed by a bank account, investments, property, shares, etc.). If the applicant is over 67 years old, then the pension insurance for a period of 12 years is needed.
Minor children and spouses receive a residence permit together with the applicant, the latter will also have the right to work.
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Documents
- Business plan in German, approved by local authorities.
- Confirmed diploma and other educational documents translated into German.
- German language proficiency certificates (if available).
- Documents confirming the registration of the company in Germany.
- Financing plan.
- Proof of sufficient pension provision (for candidates over 45).
- Long-term lease agreement for housing in Germany or documents confirming the property ownership.
- Private health insurance policy.
- Documents proving family ties: marriage certificate, birth certificates for children.
Expenses
- Administrative fee
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When applying for a national visa and residence permit, state fees are charged. The total amount will be about € 300-400 per person.
- Lawyer's fee
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The services of a lawyer, a consultant for the preparation and protection of your business plan will cost around €10,000-20,000.
- Other expenses
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The applicant must purchase a health insurance policy (from €1,000 per year), as well as purchase or rent accomodation for a long time period.
Read more about the procedure for buying real estate in Germany and related costs here.
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Rights and Obligations
The applicant has the right:
- To permanently reside in Germany, enter the country at any time and stay for any period of time.
- To provide free education for children: both in private and public schools, after graduation - in German universities.
- Not to hire employees to your company, carrying out all activities independently or with the involvement of freelance specialists.
- To open branches of your company, also outside Germany.
- To apply for government subsidies that cover 25-50% of the investment, depending on the focus and size of the project, the federal state, the number of employees involved. To do this, you need to conduct the declared activity in the EU for at least five years,as well as to have a profitable enterprise.
- To count on the possibility of loans with rates of about 1% or possibility to cover part of the costs of the loan payment (instead of subsidies).
- To claim reduced VAT rates for certain types of activities (agriculture, hotel services, etc.).
- To travel freely within the Schengen countries without a visa, as well as count on a simpler process for obtaining a visa to the United States and the UK.
- To get permanent residence permit in three years with the successful implementation of the business plan or in five years after passing the exam in German; to apply for citizenship after seven years and to finally get it after eight years.
The applicant must:
- Obtain a private health insurance policy that allows you to pay for insurance services (especially important for the elderly).
- Provide documents confirming sufficient pension provision when retired, or a long-term pension insurance policy.
- Coordinate actions with the authorities in case of intent to work for hire.
- Confirm education received in other countries and relevant to the activity that the applicant intends to conduct.
- Comply with German law, rules and regulations of the region in which the company is established.
- Pay taxes and social security contributions at rates provided by local law.
The procedure for obtaining
