Starting a business on social benefits

  • Willeke Leensma
  • How to
  • 5 February 2020
  • Edited 31 May 2024
  • 1 min
  • Starting

You are dreaming of starting your own business. But can you do that while you are on benefits? You can, with the help of your municipality and the Decree on Social Assistance to the Self-Employed (Besluit bijstandsverlening zelfstandigen, Bbz).

What is Bbz?

The Decree on Social Assistance to the Self-Employed, or Bbz for short, municipalities can offer people on welfare or unemployment benefits support towards self-employment. There are 3 ways municipalities can do this.

1. With a supplementary benefit

Using the Bbz, you can get a supplementary benefit for the costs of living for a period of no more than 3 years. This is an interest-free loan.

2. Working capital

A loan for a maximum amount of €45,483 (2024) for investments in your business, such as equipment, inventory, or stock. You need to pay interest on this loan.

3. Help during the preparation period

Most municipalities provide support for starting up your business. This can be through a 1-year preparation period (in Dutch). During this period you will receive coaching, retain your benefits, and you are freed from the obligation to seek work. Municipalities will often outsource the coaching to a specialised agency. Municipalities will cover the coaching costs for the first year after the start of your business. An example of support you might receive is learning how to write a business plan. The type of support you receive may vary between municipalities. Some municipalities do not have the option of the preparation period or do not provide coaching.

How to apply for Bbz in the municipality where you live

Do you want to apply for Bbz? Write a business plan first. This plan will show whether or not your business has a good chance of succeeding. Next, you present your business plan to a bank. If the bank rejects your business plan and, thereby, your application for a loan, you can apply for Bbz. You do this at the municipality where you live.

The municipality will set the following requirements:

  • You are between 18 and 65 years of age
  • You spend at least 1225 hours per year on your business. That is about 25 hours per week
  • You earn enough money with your business to support yourself in the future.

Bbz for established entrepreneurs

You can also apply for Bbz if you already are an entrepreneur and are experiencing financial problems, for example due to illness. A condition is that your business is viable. There is also a scheme for entrepreneurs born before 1960 and a scheme for entrepreneurs who want to end their business. 

Bbz check for entrepreneurs

Use the Bbz check (in Dutch) to find out if you are eligible for Bbz to supplement your income. Contact your municipality to find out what the local conditions and procedures are.

 

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