Border workers tax and security threshold (cross-border guide)

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Teleworking of border workers between Italy and Switzerland: clarifications on the Protocol amending the 2020 Agreement for a coordinated regulation between the tax authorities and

Context

The entry into force, on 20 January 2026, of the Protocol amending the Agreement between Italy and Switzerland on teleworking of frontier workers represents one of the most important developments in recent years in the regulation of cross-border work. After the transitional phase started on 1 January 2024, the new Protocol definitively stabilises the possibility of carrying out part of the work in agile mode without compromising the particular tax regime reserved for frontier workers. The reform, however, does not eliminate interpretative issues, as it continues to coexist with the European social security coordination system, based on different rules. The main doubt concerns the presence of two apparently incompatible thresholds: the 25% envisaged for tax purposes and the 49.9% relevant for social security purposes. In reality, these are not two alternative limits, but two autonomous disciplines that pursue different objectives and that must be read in a coordinated way. To understand the new framework, it is necessary to remember that the Agreement between Italy and Switzerland of 23 December 2020, ratified by Law no. 83 of 13 June 2023, replaced the previous Agreement of 1974 and was incorporated into the 1976 Double Taxation Convention through the reference contained in art. 15, paragraph 4. The Agreement defines a frontier worker as a resident of a Municipality located within twenty kilometers of the border

Operational details

217, entered into force on 20 January 2026. The tax system is clear today. The frontier worker may carry out up to 25% of the annual telework time by his State of residence without losing the status of a frontier worker. Within this threshold, agile working days are considered, for the sole purpose of taxation, as if they were carried out with the employer located in the other State. It is a phyctio iuris introduced to ensure continuity to the conventional criterion of separation of impositive power. This discipline is part of the wider regime introduced by the 2020 Agreement, which distinguishes between old and new frontierers. For the new frontiers, a competitor's system of taxation is operating, with deemed to be a source in Switzerland within the limits of skating and taxation in Italy through recognition of the tax credit provided for in Article 165 of the TUIR. The old frontiers, however, continue to benefit from the transitional arrangements provided for in the Agreement. Completely different is the discipline of social security. The applicable social security legislation does not fall from the Tax Agreement, but from Articles 11, 13 and 16 of Regulation (EC) No 883/2004 and Regulation (EC) No 987/2009, also applicable in relations with Switzerland under the Agreement on the free movement of persons. In this context, the Framework Agreement adopted pursuant to Article 16 of Regulation No 883/2004 is important. The agreement allows, at the request of the interested party and after the release of the A1 portable document, to maintain the subject subject to the social security legislation of the State in which the employer is based even when the telework carried out in the State of residence reaches 49.9% of the total work activity. It follows that the limit of 25% and that of 49.9% operate on completely different planes.

Key points

The first relates exclusively to the distribution of power between the two States; the second identifies the competent social security system. Confuse the two levels means attributing to the same percentage effects that the order does not recognize them. Operational relapses are significant. Businesses can not only verify compliance with the tax limit, but must also monitor separately the social security effects of telework, setting up remotely-worked day detection systems and internal procedures to document compliance with the different thresholds. Job consultants and professionals are also called to an integrated approach. The programming of agile work must take into account both the tax rules provided for in the 2020 Agreement and the 2024 Protocol, and the European provisions on social security, avoiding proper tax management to be translated into an incorrect identification of the applicable social security legislation. The new regulatory framework therefore represents an asymmetrical but coherent legal balance. The threshold of 25% protects the distribution of the taxable power and preserves the tax status of the frontier; that of 49.9% guarantees continuity in the social security cover. The absence of coincidence between the two limits does not constitute a lack of order, but the natural consequence of the functional autonomy of the two disciplines. In view of this, the coordination between the administrations of the two countries and the harmonization of application practices will be decisive, so that the diffusion of agile work continues to foster cross-border mobility without compromising legal certainty. The real challenge is therefore not to choose which threshold to apply, but to understand when each of them detects and how to coordinate their effects in the interest of workers, enterprises and administrations.

Frequently Asked Questions
What is the maximum limit of teleworking for Switzerland-Italy cross-border commuters without losing the preferential tax regime?
Cross-border workers can work up to 25% of their annual working time from their country of residence. Within this threshold, smart working days are considered, for tax purposes only, as carried out at the employer's premises in the other State, preserving the tax status of cross-border commuter.
What percentage of telecommuting is allowed to maintain social security in the employer's country?
In order to remain subject to the social security legislation of the employer's state, up to 49.9% of total work activity can be teleworked in the country of residence. This is possible upon request and upon issuance of the A1 portable document, according to the Framework Agreement.
When does the new Protocol on teleworking for Italy-Switzerland cross-border commuters come into force?
The Protocol amending the Agreement between Italy and Switzerland on teleworking for cross-border workers entered into force on 20 January 2026. This stabilizes the possibility of carrying out part of the work activity in agile mode without compromising the tax regime.
Who is considered a cross-border worker according to the Italy-Switzerland Agreement of 2020?
The 2020 Agreement defines a cross-border worker as a resident of a municipality located within twenty kilometres of the border, who carries out employment activities in the border area of the other State and returns, as a rule, to his or her home on a daily basis.
What should companies and professionals do to properly manage cross-border workers' teleworking?
They must separately monitor both the tax limit of 25% and the social security limit of 49.9%. It is essential to set up systems for recording days worked remotely and internal procedures to document compliance with both thresholds, avoiding errors in the applicable social security legislation.

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