How much does a border plumber earn in Ticino (cross-border guide)

Context

In Brief

• New Frontier Agreement in force from January 1, 2024
• Source tax withheld only in Switzerland for frontier workers
• AVS 5.3% and LPP 7-18% contributions on salary
• Italy-Switzerland Double Taxation Convention of December 9, 1976

Key Facts

• What: Labor income framework for frontier workers
• When: Agreement signed on December 23, 2020, in force from January 1, 2024
• Where: Canton Ticino, Italian-Swiss border
• Who: AFC/ESTV, cantonal administrations, INPS, Tax Agency
• Amount: AVS/AI/IPG 5.3% employee, AD/AC 1.1% (cap 148'200 CHF)
• Regime: Old frontier workers exemption 7'500€, new 10'000€
• Entity: SECO, SEM, USTAT, SUVA, BFS among those valid

The New Frontier Agreement was signed on December 23, 2020, and entered into force on January 1, 2024, redefining the rules for those living in Italy and working in Canton Ticino with a G permit. For a Swiss frontier worker, the gross salary received in Switzerland is not taxed in both countries: the source tax is withheld exclusively by the Swiss Confederation. Italy avoids double taxation by recognizing a tax credit in the CE framework of the model 730, managed by the Tax Agency. The Italy-Switzerland double taxation convention is of December 9, 1976, while Switzerland is not a member of the EU/SEE.

…

Operational details

Factors Affecting Net Salary

The calculation of how much a frontier plumber keeps in their pocket cannot be overlooked by the structural differences between the Swiss and Italian systems. In Italy, IRPEF applies in brackets: 23% up to 28,000 euros, 35% from 28,001 to 50,000, 43% above. However, thanks to the tax credit on the CE framework, the border worker does not pay twice. The Swiss withholding tax absorbs the federal and cantonal part, administered by AFC/ESTV for the Canton of Ticino.

Old and New Frontier Workers Compared

The transitional regime for those who were already frontier workers before July 17, 2023, provides for an exemption of 7,500 euros on work income, valid from 2024 to 2033. New arrivals from 2024 have a 10,000-euro exemption. This directly affects the Italian declaration: a plumber falling into the first category will only see the part exceeding the limit taxed, after benefiting from the credit for Swiss tax. The LAMal, obligatory health insurance, is not a health tax but a foreseen cost; frontier workers G have the right to opt with adult exemptions from 300 to 2,500 CHF. This also affects the available net.

The complementary pension through LPP (second pillar) varies from 7% to 18% according to age: a 25-year-old plumber pays the minimum, those with more seniority pay more, reducing the net but building up a pension. The LAINF covers accidents and varies 0.7-1.5%. The G permit issued by SEM defines the status. To assess the convenience compared to a job in Italy, these deductions must be weighed against the exemption threshold and the CHF/EUR exchange rate. A hypothetical comparison shows how two plumbers with the same gross income have different nets for age and date of employment. More details on health insurance and permits.

…

Key points

What to do to calculate your salary as a border plumber

Those who intend to work as a plumber in Canton Ticino must follow clear steps to avoid incurring double taxation or contribution deficiencies. The procedure starts with the issuance of the G permit by SEM, which enables cross-border work. The Swiss employer applies the tax at source and the AVS/LPP/LAINF contributions on the gross.

Operating steps

1. Obtain the G permit from the competent cantonal authorities (SEM coordinates). 2. Check the LPP band to which you belong for the 7-18% rate according to age. 3. Receive payroll with withholdings AVS 5.3%, AD/AC 1.1% within cap 148'200 CHF, LAINF 0.7-1.5%. 4. Fill in the Italian 730 by entering income in the EC framework for the tax credit, using data from the Revenue Agency. 5. Choose the LAMal option within the 300-2,500CHF deductibles if you are G border. 6. Use the calcolatore stipendio of Frontaliere Ticino to simulate net and impacts of the New Frontalieri Agreement.

The new agreement signed on 23/12/2020 and in force since 01/01/2024 simplifies but requires attention to the thresholds: old border workers exemption €7,500, new €10,000. The Convention of 9 December 1976 remains the basis. Subscribe to the Frontaliere Ticino newsletter through our calculator for updates on rates and crosses as Brogeda.