Incentives
Research and Development
Research and development projects can count on numerous forms of financial public support. There are many programs allocating R&D grants, interest-reduced loans and special partnership programs.
Innovation is an important precondition for ensuring Germany's international competitiveness - strengthening its resilience and expanding economic strength. Research and development is essential to the development of the German economy and is supported by numerous incentive programs.
Research and development grants generally provide money for R&D project personnel expenditure. Other costs for instruments and equipment may also be eligible if they can be clearly assigned to the relevant R&D project (only the depreciation costs for the duration of the R&D project are considered eligible where instruments and equipment are used beyond the lifetime of the R&D project).
How to Benefit from Public R&D Spending
To participate in R&D funding programs, companies must define an R&D project with clear objectives and a designated timeline. The project application should highlight the innovative character of the project and the technological risks involved.
An application for R&D funding also has to set out a commercialization plan, detailing how research results will be transformed into products, processes or services that generate additional turnover and/or employment in the region where the R&D project is located.
The total amount of incentives a project may receive depends on the size of the company (small, medium-sized or large), whether the project is conducted in cooperation with other companies or research institutes, and the research category of the project. The research category expresses the scope of the intended project.
There are three research categories:
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Germany’s High-Tech Agenda
All research programs financed by the German government have been bundled within the High-Tech Agenda.
The High-Tech Agenda defines six key technologies as strategic priorities for tackling specific challenges anticipated in the upcoming years.
In 2026, the federal government published technology roadmaps detailing the implementation framework for these technology areas:
Each area consists of a number of different R&D programs. The federal government periodically calls for R&D project proposals followed by a competition of the best project ideas. Financial support is provided to selected R&D projects in the form of non-repayable grants.
For example, grant rates can reach 50 percent of eligible project costs in the research category experimental development. Higher rates may be available for SMEs and cooperative projects.
Focus: SME Participation
A specific funding scheme called "KMU-innovativ" (website info only available in German) focuses on the participation of small and medium-sized enterprises (SMEs) to support cutting-edge research. Funding applications within the framework of the "KMU-innovativ" scheme are possible on an ongoing basis and are connected to specific research areas.
In addition, a number of national programs without a specific technological focus also exist. The "Central Innovation Program for SMEs" (Zentrales Innovationsprogramm Mittelstand, ZIM) is the most important. Application for incentives within these programs is possible at all times and without any prior calls for proposals or application deadlines. Please contact Germany Trade & Invest's incentive experts for more information.
EU R&D Grants
The European Union offers support to R&D projects in the current 2021-2027 funding period through its "Horizon Europe" research and innovation funding program. With a total budget of nearly EUR 100 billion, Horizon Europe is the world's largest research and innovation funding program.
Horizon Europe support is provided to R&D projects working at the transnational level with different project partners.
Application Procedure
The procedure is clearly structured, and applications can be completed online. The European Commission or authorized bodies publish calls for proposals on its Funding & Tenders Portal. The calls for proposals announce the research area, eligibility guidelines and the available budget.
Applications are submitted in the form of a proposal by all transnational project partners ("consortium").
Please contact Germany Trade & Invest's incentive experts for more information.
