How is the tax credit calculated if I work in Switzerland and live in Italy?

The credit is equal to the tax at source withheld from the Swiss paycheck (AVS 5.3%, AD/AC 1.1%, LAINF 0.7-1.5%, LPP and other components). On the Italian declaration, enter this amount in the EC framework of the model 730. The Italian system subtracts the credit from the IRPEF due on the basis of the progressive rates (23%, 35%, 43%) and the applicable deductible (€7,500 for old border workers, €10,000 for new ones from 17 July 2023). If the credit exceeds the IRPEF, you get a refund; if it is lower, you pay the difference.

What is the difference between old and new border crossers from 2024?

From 1 January 2024, border crossers who were already border crossers before 17 July 2023 are entitled to an exemption of €7,500 per year with a transitional regime until 2033. New frontier workers (registered from 17 July 2023 onwards) benefit from a deductible of €10,000. Both categories avoid double taxation through the tax credit in the Italian declaration, but with different protection thresholds. This distinction was introduced by the New Frontier Agreement, signed on 23 December 2020 and entered into force on 1 January 2024.

Do I need to fill out Form 730 if my income is under the deductible?

It depends on your personal situation. If your only income is frontier work and it remains under the deductible (€7,500 or €10,000), you may be exempt from the return. However, if you have other income (real estate, self-employment), you still need to fill out Form 730 or the Unico. In addition, completion is mandatory if you have undergone Swiss withholding and wish to obtain a refund of the tax credit. Consult the CAF or a professional for a personalised assessment of your position.

What documents do I need to pay attention to for the tax credit?

The main document is the Lohnausweis (Swiss income certificate) provided by the employer at the end of the year. It must report the gross, the detailed deductions (AVS 5.3%, AD/AC 1.1%, LAINF 0.7-1.5%, LPP 7–18% according to age, etc.) and the net. Check that all the figures are correct before filling out the Italian declaration. Keep a copy for at least three years, in case of checks or adjustments by the Revenue Agency.

When do I get my tax credit refund if it's mine?

The refund, if due, is managed by the Revenue Agency website. Generally, after the declaration is submitted (by 30 April), you receive a notification of the outcome within a few months. The actual refund comes via bank transfer unless you have chosen to offset with other tax debts. Times may vary based on checks and controls. It is advisable to monitor the position on the Revenue Agency's website periodically.

Border tax credit 2026: calculation guide (cross-border guide)

Di Marco Ferrari · Published on 20 August 2026

Financial advisor reviewing tax return documents for cross-border worker in Ticino-Italy region

How to obtain the tax credit in an Italian declaration, new 2024 deductibles and transitional regime for old border workers: practical guide.

Context

In a nutshell

Tax credit: compensates the Swiss tax on the Italian declaration (EC framework)
New Agreement: in force from 1 January 2024
Deductibles: €7,500 (old border guards), €10,000 (new from 17 July 2023)

Key facts

What it is: Tax credit on the Italian return to avoid double taxation
When: From 1 January 2024 (New Frontier Agreement)
Where: Model 730 or Single, CE framework
Who: Frontier workers with G permit residing in Italy
Regulatory basis: Agreement of 23 December 2020, Law 83 of 13 June 2023

The Tax Credit: How It Works

Switzerland withholds a tax at source on the labour income of the border worker. Italy, to avoid double taxation, allows the border crossing to deduct this amount from its annual declaration through the CE framework of the model 730 (or the Single Declaration). The mechanism is governed by the Convention between Italy and Switzerland of 9 December 1976 and was implemented in Italy by the New Frontier Agreement, which entered into force on 1 January 2024 after ratification by Law 83 of 13 June 2023.

This system ensures that the border crosser does not pay taxes twice on the same income. Switzerland applies a tax at source that includes different components: AVS (social security contributions) with a rate of 5.3% on the employee, AI, IPG and other deductions. The gross amount paid in Switzerland is then reported in the Italian declaration for

Operational details

Before and after the New Agreement of 23 December 2020

Prior to 1 January 2024, the regime was less structured in terms of explicit deductibles. The New Agreement has formalized and expanded the recognition of the tax credit, introducing protections for historical frontier workers through the ten-year transitional regime until 2033. This choice reflects the desire not to penalise those who have already organised their working life according to the previous rules. The transitional structure therefore offers important predictability for the tax planning of border workers in the Canton of Ticino.

The Swiss cross-border paycheck already contains the deduction for AVS/AI/IPG (5.3%), AD/AC contributions (1.1%, on a ceiling of CHF 148,200) and other mandatory components such as accident insurance (LAINF, 0.7-1.5%). In addition, the border worker also contributes to the second Swiss pillar (LPP, compulsory occupational pension), with rates ranging from 7% to 18% depending on the age group from 25 years. These contributions are deductible from Swiss gross income and affect the calculation of the tax at source. The frontier worker then receives a net amount lower than the declared gross amount.

The practical scheme: from gross to net to credit

When the border worker completes the Italian declaration, he reports the Swiss source tax paid during the year in the EC framework. This credit reduces (or cancels) the amount of personal income tax due in

Useful tools for your case

To verify your within/over 20 km tax scenario, use the net salary calculator and the tax return guide.

Key points

Step 1: Collect Swiss documents

To complete the Italian tax return and obtain the tax credit, the cross-border worker must have:

Swiss certificate of employment (Lohnausweis) provided by the employer, showing gross salary, mandatory deductions (AHV/AVS 5.3%, ALV/AC 1.1%, UVG/LAINF 0.7–1.5%, BVG/LPP), and net salary.
Annual summary of withholding taxes.
Documentation of Italian residency (to prove the status of cross-border worker pursuant to the New Agreement signed on December 23, 2020, ratified in Italy by Law 83 of June 13, 2023).

If the cross-border worker is new to permit G (registered from July 17, 2023 onwards), they will also have documentation relating to registration with the competent cantonal office. It is important to keep the original Lohnausweis and a personal copy, as it is the basic document for filling out the CE section of the Italian 730 form. Careful safekeeping of these documents is essential in the event of checks by the Italian Revenue Agency (Agenzia delle Entrate).

Step 2: Complete model 730 (Section CE)

The Italian 730 form includes Section CE (Credits for foreign taxes). In this section, the cross-border worker must: 1. Indicate the foreign country (Switzerland). 2. Report the gross amount of income from Swiss employment. 3. Indicate the total withholding tax paid during the previous calendar year.

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Frequently Asked Questions

How is the tax credit calculated if I work in Switzerland and live in Italy?: The credit is equal to the tax at source withheld from the Swiss paycheck (AVS 5.3%, AD/AC 1.1%, LAINF 0.7-1.5%, LPP and other components). On the Italian declaration, enter this amount in the EC framework of the model 730. The Italian system subtracts the credit from the IRPEF due on the basis of the progressive rates (23%, 35%, 43%) and the applicable deductible (€7,500 for old border workers, €10,000 for new ones from 17 July 2023). If the credit exceeds the IRPEF, you get a refund; if it is
What is the difference between old and new border crossers from 2024?: From 1 January 2024, border crossers who were already border crossers before 17 July 2023 are entitled to an exemption of €7,500 per year with a transitional regime until 2033. New frontier workers (registered from 17 July 2023 onwards) benefit from a deductible of €10,000. Both categories avoid double taxation through the tax credit in the Italian declaration, but with different protection thresholds. This distinction was introduced by the New Frontier Agreement, signed on 23 December 2020 and
Do I need to fill out Form 730 if my income is under the deductible?: It depends on your personal situation. If your only income is frontier work and it remains under the deductible (€7,500 or €10,000), you may be exempt from the return. However, if you have other income (real estate, self-employment), you still need to fill out Form 730 or the Unico. In addition, completion is mandatory if you have undergone Swiss withholding and wish to obtain a refund of the tax credit. Consult the CAF or a professional for a personalised assessment of your position.
What documents do I need to pay attention to for the tax credit?: The main document is the Lohnausweis (Swiss income certificate) provided by the employer at the end of the year. It must report the gross, the detailed deductions (AVS 5.3%, AD/AC 1.1%, LAINF 0.7-1.5%, LPP 7–18% according to age, etc.) and the net. Check that all the figures are correct before filling out the Italian declaration. Keep a copy for at least three years, in case of checks or adjustments by the Revenue Agency.
When do I get my tax credit refund if it's mine?: The refund, if due, is managed by the Revenue Agency website. Generally, after the declaration is submitted (by 30 April), you receive a notification of the outcome within a few months. The actual refund comes via bank transfer unless you have chosen to offset with other tax debts. Times may vary based on checks and controls. It is advisable to monitor the position on the Revenue Agency's website periodically.