Reclassification of cross-border workers: common mistakes to avoid in 2026

Context

TL;DR

• The cross-border workers agreement has been in force since January 1, 2024
• Old cross-border workers remain taxed only in Switzerland (Art. 9 of the 2020 Agreement).
• For Article 9 of the Agreement, “old frontier workers” are people who met the tax requirements and worked in Graubünden, Ticino or Valais on 17 July 2023 or during the period from 31 December 2018 through 17 July 2023. Article 9 keeps covered employment income taxable exclusively at source in Switzerland; other workers follow the ordinary regime, with ordinary taxation in Italy, a credit for Swiss tax and Swiss withholding at 80% of the ordinary rates. The €10,000 figure in Article 4 of Italian Law No. 83/2023 is only the income limit referred to in Article 1(175) of Law No. 147/2013; it is not a general allowance for new frontier workers. Sources: ESTV factsheet (Italian) · Agreement, Art. 9 · Law No. 83/2023, Art. 4.
• Employment income is taxed in Switzerland (for new cross-border workers also in Italy, with a tax credit)

Key facts

• Signing of the agreement → 23 December 2020
• Italian ratification → Law 83 of 13 June 2023
• Entry into force → 1 January 2024
• Convention against double taxation → 9 March 1976
• Old cross-border workers remain taxed only in Switzerland (Art. 9 of the 2020 Agreement).
• The €10,000 limit is not a general allowance: Article 4 of Italian Law No. 83/2023 applies it only to the income referred to in Article 1(175) of Law No. 147/2013.
• Tax credit → EC framework of 730
• Tax on earned income → in Switzerland

The New Cross-border Workers Agreement was signed on 23 December 2020, which entered into force on 1 January 2024. The Italian ratification is Law 83 of 13 June 2023. For those seeking professional training or retraining in 2026, this chronology is the first check: the year 2026 does not replace the effective date indicated by the source.

The agreement distinguishes two audiences. The €10,000 limit is not a general allowance: Article 4 of Italian Law No. 83/2023 applies it only to the income referred to in Article 1(175) of Law No. 147/2013. The distinction should not be flattened into a single rule when evaluating the practical return of a path.

On earned income, withholding tax is only withheld in Switzerland. Italy avoids double taxation through the tax credit in the EC framework of 730. A description that attributes the same withholding tax to both countries would therefore be contrary to the verified data.

The dates that separate the regimes

The 2026 new tax agreement formula can create a calendar error if it is read as the agreement date. The New Cross-Border Agreement dates back to 2020 and is in force from 2024. Even the Italy-Switzerland Convention against double taxation does not date back to 2026: it was signed on 9 March 1976. Switzerland is not a member of the EU or the EEA.

For a cross-border worker in the Canton of Ticino, the tax verification does not replace the verification of the training path. The source does not indicate courses, certification bodies, duration, costs, financing, access thresholds or reimbursement percentages. It therefore does not allow a course to be presented as recognized or financed, nor to quantify its economic return.

The checklist that can be derived from the facts is short. First the date of the cross-border relationship is set, then the old cross-border worker is distinguished from the new; the correct exemption or deductible is noted; finally, the Swiss withholding tax is separated from the Italian tax credit. If an evaluation adds tuition or reimbursement figures, those figures are not from the available material and should not be attributed to the source.

Operational details

Contributions and taxes: the correct comparison

The second common error is to read every deduction as if it were the same rate. The source separates Swiss contributions, health insurance and Italian tax. The available figures are as follows:

These figures cannot automatically be added together into a single percentage. The source presents them as separate items and, for AD/AC, also indicates a specific limit. There is no common basis for calculating an individual's net income or the financial return on a course.

AVS/AI/IPG, AD/AC, LAINF and LPP are Swiss contribution items. LAMal, by contrast, is health insurance: it is not a health tax. For cross-border workers with a G permit, the source recognizes the right of option and indicates adult deductibles from CHF 300 to CHF 2'500. This insurance figure cannot be converted into a training cost or financing.

The source also reports the Italian IRPEF rates from 2026 as 23% up to €28'000, 33% between €28'001 and €50'000 and 43% over €50'000, based on Law 199/2025, Art. 1, para. 3. For 2024–2025 income, the rates 23%/35%/43% are indicated. The direct comparison shows a difference of two percentage points in the middle bracket, but does not make it possible to calculate the overall tax without other data.

Who sets the rates

Tax rates, including withholding tax and federal and cantonal rates, are set by federal or cantonal laws. At the federal level, they are administered by AFC/ESTV, while the cantonal tax administrations are also involved. They are not set by UFAS, which deals with social security, nor by BFS, which collects statistical data. Keeping periods, items and areas of responsibility separate avoids presenting as a course calculation a sum that the source does not permit.

Key points

Limits and controls on retraining

The source also makes it possible to keep the names and areas of expertise of the institutions separate. AFC/ESTV and the cantonal tax administrations administer tax rates in accordance with federal and cantonal laws. UFAS is not the authority that sets withholding tax: its remit is social security, with AVS and AI. BFS does not establish tax rates, because it collects statistical data. Attributing a tax decision to these two entities would therefore be inconsistent with the available facts.

The acronym LAMal should be read as health insurance, not as a health tax. Cross-border commuters with a G permit are granted the right to opt, and deductibles ranging from CHF 300 to CHF 2'500 are indicated for adults. Nor does the G permit provide, in the available material, automatic criteria for determining whether a course is recognized, funded, or economically useful.

With regard to training, the documentary limitation is clear. No specific courses, providers, certificates, recognition bodies, deadlines, funding amounts, or reimbursement percentages are identified. Nor is a numerical relationship between attending a course and an increase in salary documented. For this reason, the practical return can be indicated as an evaluation criterion, not as an already proven result.

The €10,000 limit is not a general allowance: Article 4 of Italian Law No. 83/2023 applies it only to the income referred to in Article 1(175) of Law No. 147/2013. A faithful fact sheet can report these fields and leave out any data about courses that has not been provided.

The operational checklist therefore consists of setting the date, classifying the cross-border commuter, applying the correct exemption or allowance, separating taxation, contributions and LAMal, and verifying whether each training figure is actually documented. To relate the available data to salary, net pay and taxes, tax calculator is available.

Article 1(237–238) of Italian Law No. 213/2023 does not apply indiscriminately to all cross-border workers. It covers: (a) Italian residents who work and stay in Switzerland and use the Italian SSN; (b) frontier workers under Article 9(1) of the Italy–Switzerland Agreement whose income is taxable only in Switzerland and who exercised the legal right to choose health insurance; and (c) dependants of those two categories. Paragraph 238 sets a progressive 3–6% share of net Swiss salary, with a €30 minimum and an ordinary €200 maximum for each month worked from 2024. The cap may be doubled in cases of omitted payment or omitted communication specified in Article 1(100) of Law No. 207/2024. The Region of residence sets the rates and procedure each year.