Unemployment Fund: new rules for border workers (cross-border guide)

Context

In a nutshell

• New rules for frontier workers regarding unemployment funds
• Tax at source on income from work: withheld only in Switzerland for border workers
• New Frontier Agreement: signed on 23/12/2020, effective from 1 JANUARY 2024
• Old frontier workers: exemption €7,500, transitional regime 2024–2033
• New frontier workers: deductible €10,000

Key facts

• What: New rules for frontier workers regarding unemployment funds
• When: 1 JANUARY 2024
• Where: Switzerland
• Who: Frontiersmen
• Amount: €7,500 (exemption) and €10,000 (deductible)

The New Frontier Agreement was signed on 23/12/2020 and provides for new rules for frontier workers regarding unemployment benefits. The new legislation provides for the withholding tax on labour income to be withheld only in Switzerland for frontier workers. Old frontier workers are exempt from €7,500, while new frontier workers have a deductible of €10,000.

Switzerland is not a member of the EU/EEA, so it is not subject to EU unemployment rules. The Italy-Switzerland double taxation agreement was signed on 9 DECEMBER 1976.

Operational details

The use of the unemployment fund is a crucial aspect for frontier workers, as it guarantees them economic support in the event of job loss. The new legislation provides that income tax at source is only withheld in Switzerland, which means that frontier workers will no longer have to pay taxes twice. Old frontier workers are exempt from €7,500, while new frontier workers have a deductible of €10,000.

The Italy-Switzerland double taxation agreement was signed ON 9 DECEMBER 1976 and provides for taxes to be paid only in one of the two countries. Switzerland is not a member of the EU/EEA, so it is not subject to EU unemployment rules.

Recommended tools

For an updated estimate, use the net salary calculator and the CHF-EUR exchange comparator.

Key points

If you are a frontier worker and have lost your job, you can apply for the unemployment fund. To do this, you must submit an application to the relevant office. You also need to provide the necessary documents, such as identity card and residence certificate.

The unemployment fund is an economic support that guarantees frontier workers an income in the event of job loss. The new legislation provides that income tax at source is only withheld in Switzerland, which means that frontier workers will no longer have to pay taxes twice.

Check tax deadlines for cross-border workers: returns, Swiss declarations, rebates — all dates in one interactive calendar.

Source: cassa-disoccupazione.unia.ch