To provide you with more information regarding CHANCEN eG and the Income Share Agreement (ISA), we have gathered some of the questions that are most frequently asked by our applicants and members of our cooperative. You are always welcome to contact us should you have further questions or if you would like more details on the questions below.
If your income is very high. then the maximum repayment amount, as stipulated in your contract, is applicable. Over the entire repayment period beneficiaries never have to repay more than twice the actual amount (adjusted to inflation) on tuition fees as per the enrolment date.
The repayment is based on gross income, once social security contributions and related expenses have been deducted. This is applicable when your net income is 78.8 % of total earnings, for freelancers (non-employees) it is 63.0 % of total income. Total income includes: gross income, rental and investment income less the standard amount paid to pension benefits. This calculation is based on current guidelines from the German Education Act BAföG – deductions for employees, trainees and inactive persons are approx. 21.2% and for non-workers 37.0% ).
Premature payments and settlements on an ISA will be a total of the maximum contribution. As we cannot foresee how high an individual’s future income may be, we request maximum payments. This is done in solidarity with the community and is part of the promise made to future generations.
In the first place, this will not have any effect on your repayment since a lottery win and a lump sum of inheritance are not defined as income according to the German Income Tax Law (§2 Einkommensteuergesetz). Nevertheless, if you invest this money profitably generating any income (e. g. rental income because you bought a flat with the money), this income will increase your repayment amount.
The freedom to create your own career path is one of the fundamental values of CHANCEN eG. It states that the freedom to choose your career should not be limited by an Income Share Agreement. This also applies to jobs where wages are lower. Unlike traditional credit, the ISA has no fixed loan amount that needs to be paid within the first few years following graduation. Due to the minimum income threshold, educational funding is socially responsible in cases where beneficiaries earn a lower income. If you consciously decide to earn below the minimum threshold of 27,000 EUR you are not obliged to make repayments. Once the income is above that limit you will be obliged to make repayments.
The minimum income threshold is the amount that indicates at which point graduates need to start repayments to CHANCEN eG. The amount is an annual income of 27.000 Euro. If you earn less than this you are not obliged to make repayments.
Repayments stretch over a 25 year period. During this time repayments are made within the first eight to twelve years for universities and five/six years for bootcamps, provided relevant income exceeds the minimum threshold of 27,000 Euro. Should your income not exceed this amount in this 25 year period or if it exceeds the minimum threshold amount less than eight to twelve times (for universities) or five/six times (for bootcamps) then the repayment obligation becomes null and void.
Your repayment of your tuition fees will start once you exceed the minimum income threshold, regardless of whether you further your education, do a traineeship or go into academia.
The potential repayment period begins on January 1 of the year following the successful completion of your studies. The actual repayments only start once you earn above the minimum income threshold.
Yes, in principle, the repayments could be tax deductible but this is dependent on the country you are based in. Find more from your local Tax office.
No. Income Share Agreements are based on the principle of solidarity: everybody contributes based on their financial capacity. Unlike an ordinary student loan, you are not obliged to repay a fixed amount of debt. If you have paid an amount based on your income that is above the minimum threshold over a total of eight to twelve years for universities or five/six years for bootcamps, your repayments will end. Irrespective of the total amount you have paid.
No, ISA’s do not take into account whether you are employed or not. It only assesses what your actual, current income is.
CHANCEN eG believes in freedom; for your studies and your career choices. If you decide to work abroad once you have completed your studies, you simply need to supply us with you Income Tax Return from the relevant country. If this Income Tax Return differs strongly from the German equivalent, you have to expound your income in the German format with the help of a tax consultant or auditor.
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