BAFA Funding | Your Guide to Consulting Subsidies

Do you want to expand your business with BAFA funding? Are you just starting your entrepreneurial journey? Poor business decisions can have serious consequences. Perhaps you’re looking for support from consulting experts to accelerate your growth and avoid costly mistakes. BAFA’s consulting grant helps with this: depending on location, it covers 50 or 80% of eligible consulting costs. If you need financial support for your business in Germany, our easy-to-understand and comprehensive guide is exactly what you’re looking for.

If you’d rather not put together your business plan and numbers alone, we support you in Strategy Consulting.

Is Consulting Really Necessary?

Professional external consulting is a competitive advantage. It can support a company with specialized workforce expertise in a particular area, provide specialized skills for a specific task, or offer an outside perspective for a new, innovative approach. Once a company is operational, areas emerge where external expertise is needed. For example, a business plan must be perfect, contextually appropriate, and formally sound for potential investors. Since time is your most valuable asset, consultants can, for example, take over business plan development while you focus on important daily operations.

Who Is This BAFA Funding Guide For?

BAFA funding is subject to a number of conditions to be eligible. First, your company must be based in Germany and meet the definition of SME (small and medium-sized enterprise). To meet these criteria, your company must have its headquarters in Germany, employ fewer than 250 employees, and generate annual revenue of less than 50 million euros.

Three groups of companies are eligible for BAFA funding:

• Startups: defined as young companies that have been on the market for less than two years
• Established companies: defined as companies in their third year or later after founding
• Companies in difficulty: defined as companies in economic difficulties—regardless of the company’s age

The founding date is the date of business registration or commercial register entry for trading companies such as a UG or GmbH. For freelancers, it is the date of registration with the tax office.

To summarize in one sentence: If you are registered as a business or freelancer in Germany and have not yet used BAFA funding, you have a good chance of being eligible for the funding program.

What Types of Consulting Does BAFA Funding Cover?

Young and established companies can receive support in the following consulting areas:

General consulting on these topics:

• Business and economics
• Finance
• Personnel
• Management organization

Specialized consulting for companies:

• led by female entrepreneurs
• led by migrants
• led by entrepreneurs with recognized disabilities
• to improve the integration of employees with migration backgrounds into the company
• to design work for employees with disabilities
• to recruit and retain skilled workers
• for equal opportunity and better work-life balance
• for age-appropriate work organization
• for sustainability and environmental protection

Companies in difficulty receive funding for:

• Consulting on business stabilization to restore performance and competitiveness in an economically difficult situation
• Succession consulting to deepen insights gained from business stabilization consulting to restore performance and competitiveness in all economic, financial, personnel, and organizational aspects of business management.

What Consulting Topics Does BAFA Funding Cover?

Consulting topics are diverse and include business, financial, and organizational consulting. Let’s take a closer look at these areas:

Business Consulting

This can include marketing and sales, technology and innovation consulting to clarify the opportunities and risks of innovations and the application of new products, processes, and services.

A list of topics can include:

• Improvement of the business concept
• Location and competition
• Procurement
• Production
• Product portfolio
• Inventory/systems
• Marketing and sales
• Business expansion
• Succession planning

Financial Consulting

The challenge for many entrepreneurs is keeping their finances under control. Often there is a lack of necessary financial planning and know-how. For example, when it comes to financing investments, not all available offers from capital providers can be utilized.

These include, for example, banks, investors, funding institutions, and venture capital providers. The following consulting topics can help:

• Calculation of investment needs and profitability
• Review of liquidity
• Development of a financing strategy
• Clarification of appropriate capital procurement
• Possible financing through capital reallocation

Organizational Consulting

Business processes stall, targeted quality goals are not achieved, competitiveness declines—all of this is the result of one of the most overlooked areas: organization.

With poor organization, valuable resources and time are misallocated instead of increasing the company’s productivity and revenue.

Consulting topics to improve the organization of a company would be:

• Business direction/strategy
• Process optimization
• Organizational structure and workflow
• Restructuring

Other topics include personnel consulting for:

• Female entrepreneurs
• Female and male entrepreneurs with migration backgrounds
• Female and male entrepreneurs with recognized disabilities
• Integration into the business
• Design of work for employees with disabilities
• Recruitment and retention of skilled workers

Tip: The right consultant will be able to tell you where you can expect the greatest return on investment. This way, you achieve the best impact on your business.

We are listed as BAFA consulting (#171555), and you can get your consulting financed. Schedule a free consultation and start your growth journey with us. Let us know if you have any further questions or need additional consulting support—we’re here for you.

Who Is Not Eligible for BAFA Funding, Regardless of the Need for Consulting?

Companies and members of free professions with a focus on consulting are excluded from BAFA funding.

These are largely divided into the following areas:

• Consulting and auditing firms
• Tax advisors
• Lawyers and notaries
• Companies in or facing insolvency
• Non-profit organizations
• Legal entities under public law

How Much Is the BAFA Funding Amount?

The amount of the consulting subsidy depends on two factors: the maximum eligible consulting costs as the basis for calculation and the company’s location. The subsidy counts as de minimis aid.

The rates according to the BAFA fact sheet on grant, payment and proof of payment (in German):

• New federal states (excluding Berlin and the Leipzig region), the Lüneburg region and the Trier region: 80%, at most €2,800
• Old federal states, Berlin and the Leipzig region: 50%, at most €1,750

Consulting costs up to €3,500 are eligible. You pay anything above that yourself. Applications are open until 31 December 2026.

The age of the company does not matter for the grant.

How Do I Apply for BAFA Funding?

The most important point with BAFA funding is that you must follow the correct order of application steps to avoid financial losses. Costs for consulting services provided before BAFA funding approval will not be covered.

The funding application is submitted via the BAFA website and contains only a few questions. nxt milestone can help you with the application process. After a coordinating center has reviewed the funding application, you will receive an information letter with the result of the review. If funding for the consulting is approved, the consulting contract can be concluded and business consulting can begin.

Young companies and companies in difficulty must participate in a free information consultation (by phone or in person) with a regional partner before submitting the BAFA application. This can be, for example, a partner of the IHK (Chamber of Industry and Commerce). After that, the funding application must be submitted within three months.

Instructions for Completing the BAFA German Consulting Funding Form

• Click on the company type category that matches your business.
  • Startup = not longer than two years on the market
  • Established company = from the third year after founding
  • Company in difficulty = regardless of company age, e.g., economic difficulties due to loss of major customers
• Complete your information from the business/commercial register application in the company/management section. Legal forms for natural persons include sole proprietor, partnership, and registered merchant (e.K.). Legal forms for legal entities include UG, GmbH, and public limited company (AG).
• Your company is entitled to input tax deduction if it collects sales tax and remits it to the tax office. Freelancers and small businesses are exempt under § 19 of the Sales Tax Act.
• You can find the list of DIHK contact persons at the DIHK. For established companies, a consultation is not required. Select “DIHK” here.
• Economic sector classification is used to categorize your company. BAFA has published a short guide for this. You can simply copy the business purpose from your business registration. Then you only need to check a few confirmations and you can submit your business consulting funding application.

What Happens After Application?

STEP 1: The DIHK reviews the formal requirements for funding and sends confirmation via email.

STEP 2: Consulting can now begin. The confirmation must definitely be received before starting, otherwise funding cannot be granted. The date on the consulting contract is considered the start of the consultation.

STEP 3: The consulting must be completed within six months of receiving the information letter.

STEP 4: The applicant must provide proof of payment of their contribution as part of the funding procedure.

Final Step: The coordinating center, such as the DIHK, reviews the formal requirements and documentation. It then forwards the documentation to the Federal Office for Economics and Export Control (BAFA) for a decision.

Additional Links for BAFA Funding

The following links lead to German websites, and BAFA primarily communicates in German:

• Online portal for applications
• Proof of use form “Business Consulting”
• Online status inquiry at BAFA
• Upload option for documents to request funding
• Brochure “Promotion of Entrepreneurial Know-how”

If you need help, please don’t hesitate to contact us!

Book your free initial consultation now.