Crodo: guide for border workers working in Ticino (cross-border guide)

Context

In brief

• As of January 1, 2024, the new tax agreement is in effect: old cross-border workers are exempt €7,500/year, new ones €10,000 in allowance
• Crodo (VB, Piedmont) offers a lower cost of living than Ticino but maintains quick access to border crossings (Brogeda, Gaggiolo)
• Withholding tax is paid only in Switzerland; Italy grants tax credit via the CE section of the 730 form
• LAMal in G regime: choice between Swiss insurance (CHF 300–2,500 deductible) or Italian INPS

Key facts

• What: Living in Crodo (Verbano-Cusio-Ossola, Piedmont) and working in Canton Ticino with a G permit
• When: New agreement effective from January 1, 2024
• Where: Crodo ↔ Brogeda/Gaggiolo/Chiasso border crossings towards Ticino centers (Lugano, Mendrisio, Bellinzona)
• Who: Cross-border workers with a G permit and interested in moving residence
• Amount: Exemption €7,500 (old cross-border workers) or allowance €10,000 (new), transitional regime 2024–2033

Crodo is becoming an increasingly popular choice among workers who want to obtain a G permit to work in Ticino while maintaining a residence in Piedmont. The town, located in the province of Verbano-Cusio-Ossola, offers a concrete balance between lower housing costs compared to Canton Ticino and geographical proximity that reduces commuting times to the main Ticino work centers (Lugano, Mendrisio, Chiasso, Bellinzona, Locarno).

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Operational details

Taxation: withholding tax, double taxation and refunds

For a cross-border worker living in Crodo and working in Ticino, the withholding tax is exclusively deducted in Switzerland on the pay slip. There is no immediate double taxation: Italy does not levy further on the gross amount but allows a tax credit through the CE section of the tax return (model 730 or model Unico). This mechanism is governed by the Italo-Swiss Convention on Double Taxation signed on December 9, 1976, which ensures stable legal protection.

The withholding tax rate applied by Switzerland varies according to the canton and individual incomes: in Ticino, the combined federal and cantonal rates are administered by the Federal Tax Administration (FTA/ESTV). The tax return in Italy allows for the recovery of excess taxation if the Swiss rate is higher than the Italian one (IRPEF: 23% up to €28,000, 35% from €28,001 to €50,000, 43% over €50,000).

Refunds are the concrete mechanism for returning overpaid taxes. If a cross-border worker pays more tax in Switzerland than due in Italy (for income declared in both countries), the tax credit in the 730 ensures the refund of the difference. The deadline for submitting the declaration in Italy is by May, allowing an annual verification of the overall tax position.

AVS, LPP, LAMal: the three pillars of social security and health

Enrollment in AVS (Old-Age and Survivors' Insurance) is mandatory for any cross-border worker employed in Switzerland. The AVS/AI/IPG contribution rate for the employee is 5.3%, to which AD (unemployment insurance) 1.1% and AC (accident insurance) up to 1.5% depending on the sector are added. The maximum income limit for AD/AC calculation is CHF 148,200 per year.

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Key points

How to organize: step-by-step towards the transfer

Before moving to Crodo, some administrative steps are essential and must be followed in sequence:

1. Verify the G permit: this is the basic requirement for cross-border workers. It must be requested by the Swiss employer in coordination with the cantonal authorities (Migration Section of the Canton Ticino, SECO). The permit is linked to the specific employment contract and requires a formal procedure with the municipality of Crodo and the Italian prefecture.

2. Italian tax registration: once a resident of Crodo, register with the Agenzia delle Entrate of the competent district. Notify the change of residence to the municipality of Crodo to update the registry.

3. Health insurance choice (LAMal): within the registration deadline for the first job in Switzerland, decide whether to opt for Swiss LAMal (with a Ticino health insurance fund) or remain in the Italian INPS system. The choice is not reversible without reasons recognized by the authorities.

4. Open a bank account: not always mandatory, but useful to have an account in Switzerland for receiving the salary without currency commissions. Alternatively, an Italian account with an IBAN compatible with CHF-EUR cross-border transfers works just as well, with attention to the exchange rate.

5. Italian tax declaration (730/Unico): each year, by May, complete the declaration including the gross Swiss income, the withholding tax already paid by Switzerland, and the tax credit in the CE section. This allows the recovery of overpaid amounts and the documentation of residence in Italy for tax purposes.

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