Living allowance will remain an important support for low-income households in 2025. The adjustments made by the Wohngeld Plus reform ensure that the financial aid is adapted to the current cost of living. Here you can find out who is entitled, how much the grants are and which changes are relevant from 2025.
What is living allowance?
Living allowance is a state subsidy that helps low-income households with their housing costs. It is aimed at both tenants (rent subsidy) and homeowners (encumbrance subsidy). The prerequisite for receiving it is that the applicant has a certain income, but this is not sufficient to cover the housing costs. However, the living allowance only covers part of the housing costs and not the entire rent or charges.
Who can apply for living allowance?
In principle, tenants and owners can apply for living allowance if they do not exceed the applicable income limits. There is an allowance of 60,000 euros for the first household member and a further 30,000 euros for each additional member. Of course, owner-occupied property does not count as assets.
At the same time, a minimum income must be available to cover living expenses including housing costs. The income limits vary depending on household size and rent level and are generally based on the statutory standard requirement. For example, for a single person in a medium rent bracket, a monthly income of around €1,200 is the minimum requirement.
Please note: If you fall below the minimum income, you are usually entitled to citizens allowance instead of living allowance. Citizens allowance is also for people who cannot cover their standard needs despite their income.
Do you still need to apply for living allowance? With our living allowance calculator from LeistungsLotse, you can quickly and easily check whether and how much living allowance you are entitled to. Check now!
New income limits for 2025
The income thresholds for 2025 will be raised when the living allowance regulations are updated. The increase in the living allowance is intended to prevent households from falling out of entitlement due to rising rental costs. The rent level of the city/municipality and the number of household members are relevant for the maximum amounts. Don't worry, if your rent exceeds the maximum rent amount, you are not excluded, the excess amount is just not taken into account. Heating and air conditioning costs will still be taken into account.
How high is the living allowance in 2025?
The amount of the living allowance depends on three main factors:
Number of household members
Amount of total income
Housing costs and rent level
The average monthly benefit is forecast to be around 400 euros in 2025. However, a detailed calculation is necessary as individual factors such as heating costs and regional differences are taken into account. In the table below you will find the maximum allowances for different household sizes:
These allowances are only guidelines. The actual amount is calculated individually and also depends on additional components such as the climate component, which has been part of the calculation since the 2023 living allowance reform.
With our living allowance calculator from LeistungsLotse, you can quickly and easily check whether and how much living allowance you are entitled to and send your application directly to us. Check now!
Examples of the increase
On average, the living allowance will increase by 15%, primarily to take account of rising rents and inflation in recent years. A family with four household members in Essen (rent level 3) and a gross income of €4,125 pays a monthly rent of €950. While this family received a rent subsidy of 267 euros in 2024, the amount will rise to 335 euros in 2025 as part of the living allowance increase. This corresponds to an increase of €68 compared to 2024.
The adjustment is based on the updated living allowance formula and the new table values, which indicate the maximum possible living allowance per household and rent level. Depending on the number of household members and the respective housing costs, the reform will provide noticeable relief and thus include a larger number of households in the subsidy.
Objectives and effects of the 2025 living allowance reform
The 2025 living allowance reform aims to provide low-income households with better protection against rising living costs and rents. The 2025 living allowance increase and the adjustment of the living allowance formula and income limits will enable more people to benefit from the support. In particular, single parents, pensioners and households that are just above the threshold for basic income support will receive much-needed relief as a result of the reform. Citizens allowance and social welfare recipients will also benefit indirectly, as the living allowance can help to cover housing costs as a supplementary benefit. The reform aims to promote financial independence and prevent living allowance recipients from slipping into basic income support due to rising costs. The biennial update of the values is intended to ensure that the support remains permanently adjusted to economic realities. In the long term, the reform strengthens social stability by offering low-income households more planning security and protection against financial overstretch.
How do I apply for living allowance?
Living allowance must be applied for at the relevant living allowance office. The required documents are
Proof of income, i.e. payslips or a certificate of earnings
Tenancy agreement or proof of housing costs
Identity card or passport
The processing time may vary. To avoid interruptions, an application for continued authorisation should be submitted around two months before the end of the previous authorisation period. Important: The living allowance is not paid retroactively, but only applies from the month in which the application was submitted.
Conclusion
The 2025 living allowance offers low-income households valuable financial support to help them cope with housing costs. Thanks to the increased income limits and allowances, the benefits remain attractive despite the rising cost of living. An early application and precise knowledge of the requirements can help you to make the most of the financial relief.
Do you still need to apply for living allowance? With our living allowance calculator from LeistungsLotse, you can quickly and easily check whether and how much living allowance you are entitled to. Check now!