What is the difference between deductible and tax credit?

The deductible (€7,500 or €10,000) is an income threshold exempt from Italian taxation; up to that limit the income is not taxed. The tax credit is the amount of taxes already paid in Switzerland, which reduces the Italian tax burden due. The deductible decreases the tax base; the credit reduces the tax calculated on that base.

How do I report income if I worked in both Switzerland and Italy in the same year?

Swiss income must be declared in the EC framework of the 730 model or the PF Income Model, indicating Switzerland as a foreign country. Italian incomes (if any) must be indicated in the ordinary tables A or B of the model 730. Each country of origin must be reported separately; foreign taxes are added into the total tax credit.

If I pay few taxes in Switzerland, will I get a higher Italian tax?

Partially yes. The deductible (€7,500 or €10,000) automatically reduces the Italian tax base. If the Swiss tax credit is not sufficient to cover the Italian tax calculated on the reduced basis by the deductible, the frontier worker must pay a balance. However, with the excess the overall load remains lower than a resident Italian worker.

Can I request a refund if I paid too much in taxes?

Yes. If the Swiss tax credit exceeds the Italian tax due on the reduced basis from the deductible, the Revenue Agency will credit the refund. The request is made through the CE framework of 730 or the PF Income Form and the refund is usually processed within a few months of the correct submission of the return.

When does the tax return for frontier workers expire?

As for all Italian taxpayers, the ordinary term is in May of the year following that of income (e.g. May 2025 for 2024 income). If submitted through CAF or certified accountant, it can be extended until November. For changes or corrections after the presentation, there is a window until March 31 of the following year.

Tax deductions for border workers 2026 (cross-border guide)

Di Marco Ferrari · Published on 3 September 2026

Aerial view of Mendrisio and Swiss-Italian customs border crossing in daylight

Deductions and tax credits for those who work in Switzerland and reside in Italy: deductibles €7,500-€10,000, EC framework, tax return.

Context

In a nutshell

New border agreement in force from 1 January 2024
Excess €7,500 old frontier workers, €10,000 new
Source tax paid in Switzerland, credit in Italy
Declaration via EC framework of the model 730

Key facts

What: New agreement on border taxation
When: 1 January 2024 (vigor)
Where: Italy-Switzerland Frontier, Canton of Ticino
Who: Frontier workers with G permit
Deductible: €7,500 (old), €10,000 (new from 17/7/2023)
Tax: Withholding tax in Switzerland, credit via CE framework

The Ticino border worker who works in Switzerland and resides in Italy today finds himself in a scenario well defined by the new legislation. From January 1, 2024, the New Frontier Agreement entered into force, signed on December 23, 2020, which outlines the definitive taxation rules for those who cross the border daily for work reasons.

# New franchises

The main novelty concerns deductibles — that is, the income thresholds exempt from the Italian tax burden. For frontier workers who were already frontier workers before 17 July 2023 (the "old frontier workers"), the exemption is €7,500 per year under the transitional regime that lasts until 2033. For those who became border workers after that date, the deductible rises to €10,000. This means that the first tier of annual gross income, up to that threshold, is not taxed in Italy.

How source tax works

The basic mechanism is simple but crucial:

Operational details

The declaration in Italy: the CE form

Every year, the cross-border worker who works in Switzerland must file the Italian income tax return. In the 730 form (or in the Redditi PF form if preferred), they must complete the CE form to report income earned abroad and taxes already paid.

The CE form is the tool with which the cross-border worker communicates to the Italian Revenue Agency:

The gross income received in Switzerland (from Swiss documentation)
The withholding taxes in Switzerland (federal/cantonal tax, AVS, AI, IPG, LAINF, solidarity contribution)
The request for tax credit based on what has been paid abroad

The Italian Revenue Agency then calculates whether the cross-border worker must pay additional tax in Italy (when the income exceeds the exemption and the tax credit does not fully cover the Italian tax according to the IRPEF rates: 23% up to €28,000, 35% from €28,001 to €50,000, 43% over €50,000), or whether they will receive a refund (when the credit is higher than the Italian tax due based on the reduced amount by the exemption).

Old vs. new cross-border workers: practical implications

The distinction of date (July 17, 2023) creates two parallel regimes until 2033. A cross-border worker who started working in Switzerland before that date enjoys an exemption of €7,500 in the transitional regime. Those who started after benefit immediately from an exemption of €10,000. This means that, with the same gross income in Switzerland, the new cross-border worker has a wider tax exemption in Italy, and therefore potentially lower Italian tax burden.

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Key points

Step-by-step declaration procedure

The tax declaration for cross-border workers follows a well-defined procedure that begins many months before the deadline:

Step 1: Gather Swiss documentation From the Swiss employer, the cross-border worker receives at the end of the year (usually by January) the withholding certificate (tax slip). This document indicates all taxes and contributions paid in Switzerland: federal withholding tax, cantonal tax, AVS, AI, IPG, LAINF, and solidarity contribution if applicable. This slip is essential to complete the CE form.

Step 2: Fill out the Italian declaration In Italy, the cross-border worker submits the 730 form (through a tax substitute or independently online on the Agenzia delle Entrate website). In the CE form, they report the gross foreign income (from Swiss documentation) and the taxes paid abroad, then request the tax credit. The Agenzia delle Entrate provides specific instructions for the CE form on its official website.

Step 3: Application of the exemption and tax calculation The Agenzia delle Entrate subtracts the due exemption (€7,500 if cross-border before 17/7/2023, €10,000 if after) from the taxable base. It calculates the Italian tax on this reduced base according to the IRPEF rates and applies the Swiss tax credit. If the credit exceeds the Italian tax, the cross-border worker is entitled to a refund.

Step 4: Respect deadlines The deadline for submitting the 730 is usually in May of the following year (with extensions to November if through CAF or accountant). Modifications and clarifications can be made by March 31 of the following year through an additional declaration.

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Frequently Asked Questions

What is the difference between deductible and tax credit?: The deductible (€7,500 or €10,000) is an income threshold exempt from Italian taxation; up to that limit the income is not taxed. The tax credit is the amount of taxes already paid in Switzerland, which reduces the Italian tax burden due. The deductible decreases the tax base; the credit reduces the tax calculated on that base.
How do I report income if I worked in both Switzerland and Italy in the same year?: Swiss income must be declared in the EC framework of the 730 model or the PF Income Model, indicating Switzerland as a foreign country. Italian incomes (if any) must be indicated in the ordinary tables A or B of the model 730. Each country of origin must be reported separately; foreign taxes are added into the total tax credit.
If I pay few taxes in Switzerland, will I get a higher Italian tax?: Partially yes. The deductible (€7,500 or €10,000) automatically reduces the Italian tax base. If the Swiss tax credit is not sufficient to cover the Italian tax calculated on the reduced basis by the deductible, the frontier worker must pay a balance. However, with the excess the overall load remains lower than a resident Italian worker.
Can I request a refund if I paid too much in taxes?: Yes. If the Swiss tax credit exceeds the Italian tax due on the reduced basis from the deductible, the Revenue Agency will credit the refund. The request is made through the CE framework of 730 or the PF Income Form and the refund is usually processed within a few months of the correct submission of the return.
When does the tax return for frontier workers expire?: As for all Italian taxpayers, the ordinary term is in May of the year following that of income (e.g. May 2025 for 2024 income). If submitted through CAF or certified accountant, it can be extended until November. For changes or corrections after the presentation, there is a window until March 31 of the following year.