KfW Heat Pump Subsidy: What Applies Since July 21, 2026
What changed on July 21, 2026
The base subsidy for heating replacement in residential buildings stays at 30% of eligible costs, with a maximum subsidy of €28,000 for the first residential unit (€15,000 each for units two through six, €8,000 for each further unit). Two things changed noticeably with the new conditions: the income bonus is fundamentally restructured (see below), and repayment subsidies (Tilgungszuschüsse) are reduced by a flat 10 percentage points.
New income tiers for the income bonus
The income bonus can be claimed in addition to the base subsidy if you occupy the property yourself. Since July 21, 2026, a more finely tiered structure based on annual household income applies:
| Annual household income (no children) | Income bonus |
|---|---|
| up to €30,000 | 40% |
| up to €40,000 | 30% |
| up to €50,000 | 10% |
Families with minor children living in the household benefit from higher income thresholds (40% up to €40,000, 30% up to €50,000, 10% up to €60,000 annual household income); each child reduces the counted household income by a one-time €10,000.
The transition window has closed
Important nuance: the transition rule didn't automatically apply to every new application – it specifically covered customers who already held a valid application confirmation from KfW. They could still submit their application under the previous conditions until July 20, 2026. Since July 21, 2026, every new application runs under the new conditions.
Degression from 2027
On top of the July 21, 2026 changeover, the maximum subsidy amount for heating subsidies in residential buildings will decrease step by step from 2027: first on February 1, 2027, then every six months (February 1 and August 1) by €750 per step. So delaying a project further means losing subsidy value over the medium term.
What this means for your planning
New applications run under the new conditions throughout. Depending on your household income, the new income bonus tiers may work out more or less favorably than the previous rules – checking your own tier before applying is worthwhile. And with degression starting February 2027, the maximum subsidy decreases every six months: a later application tends to mean a lower cap.