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Your company is insolvent or over-indebted

When the employer becomes insolvent

Understand the grounds and the procedure of insolvency and the insolvency benefit, compute the filing deadline, the employees' insolvency benefit and the levy, issue the insolvency benefit certificate and support the applications: 8 steps.

Start here: German insolvency: grounds, proceedings, debt discharge

Understand: insolvency procedure and insolvency benefit

  1. Step 1 of 8
    CoursePaid individually45 min

    German insolvency: grounds, proceedings, debt discharge

    Illiquidity, impending illiquidity and over-indebtedness are three different grounds for opening, and only two of them apply to a sole trader. The first module covers the application, interim measures, opening and the insolvency estate, including the release of a self-employed activity. The second separates standard from consumer insolvency and covers the settlement attempt, the three-year assignment period, the debtor's obligations and the claims that survive discharge. Two modules with case studies worked on the statute itself.
  2. Step 2 of 8
    CoursePaid individually66 min

    German unemployment, short-time work and insolvency pay

    Unemployment benefit is paid after twelve insured months within 30 months, at 60 or 67 per cent of a flat-rate net pay and for six to 24 months — yet resigning without good cause costs a twelve-week suspension and at least a quarter of the duration. The second module walks through the notification, the one-third threshold and the net pay difference of short-time work allowance, and through insolvency pay for three months, capped at 8,450 euros gross. The third shows why these tax-free benefits still cost tax through the progression proviso and require a return above 410 euros.

Compute: filing deadline, insolvency benefit, insolvency levy

  1. Step 3 of 8
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    German insolvency filing deadline: three or six weeks

    The deadline is a CEILING, not a cushion: s. 15a(1) sentence 1 requires the filing 'without culpable delay'. Letting three weeks pass without working on a rescue or on the filing breaches the duty before the deadline even expires.
  2. Step 4 of 8
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    German insolvency pay — how much does the agency actually cover?

    Only the last THREE MONTHS OF THE EMPLOYMENT preceding the insolvency event are covered (SGB III s. 165(1)) — if the employment ended earlier, its last three months; older arrears remain claims in the insolvency proceedings.
  3. Step 5 of 8
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    German insolvency pay levy (U3): rate and contribution base

    The employer alone pays 0.15 percent a month of the pay on which pension contributions are assessed — so never above the pension contribution ceiling. Public employers that cannot become insolvent and private households are exempt.

Issue and apply: insolvency benefit certificate, application, managing-director supplement

  1. Step 6 of 8
    FormFree30 min

    Issuing the German insolvency pay certificate (Insolvenzgeldbescheinigung)

    The insolvency administrator issues the Insolvenzgeldbescheinigung for each employee at the request of the Federal Employment Agency — or the employer itself where no proceedings were opened (section 314 SGB III). Who certifies, what goes in it, and what a wrong entry costs.
  2. Step 7 of 8
    FormFree40 min

    Applying for German insolvency pay (Antrag auf Insolvenzgeld, employee form)

    The employee applies for insolvency pay (Insolvenzgeld) at the employment agency — within two months after the insolvency event, which may also be a dismissal of the petition for lack of assets (section 324(3) SGB III). Who applies, by when, which documents, and what an advance or a garnishment changes.
  3. Step 8 of 8
    FormFree50 min

    German insolvency benefit for shareholder-managing directors — the supplementary sheet

    Insolvency benefit (Insolvenzgeld) is for employees only (§ 165 SGB III). A shareholder or managing director of a GmbH or UG uses the supplementary sheet to show that he was employed — or encloses the clearing office's status decision. The pension insurance's yardstick: 50 % or a blocking minority rule employment out.

The other paths

A different procedure, the same principle: the three pillars in order.

Read in German