Living in Alta Valle Intelvi and working in Ticino as a border worker (cross-border guide)

Context

In a nutshell

• The new Frontier Agreement was signed on 23 December 2020 and will enter into force on 1 January 2024.
• The Italy-Switzerland double taxation agreement was signed on 9 December 1976.
• Switzerland is not a member of the European Union.

Key facts

• Who: New Frontier Agreement
• When: 23 December 2020
• Where: Ticino, Italy
• What: New Frontier Agreement
• Amount: not yet specified

The new Frontier Agreement provides for changes to the tax rules for frontier workers. The Italy-Switzerland double taxation convention guarantees the non-double taxation of border workers' income.

Living in Alta Valle Intelvi and working in Ticino as a border worker

If you are an Italian citizen residing in Alta Valle Intelvi, but working in Ticino, the new Frontier Agreement could have a significant impact on your tax situation.

The Italy-Switzerland double taxation agreement, signed on 9 December 1976, guarantees the non-double taxation of border workers' income. This means that employment income is taxable only once, in the country where it was received.

However, the new Frontier Agreement provides for changes to the tax rules for frontier workers. Under the new Agreement, frontier workers will be able to benefit from a 10% reduction in taxes due in Switzerland. This reduction will only be applied on taxes due in Switzerland and not on Italian taxes.

For example, if

Operational details

Border workers working in Ticino and residing in Alta Valle Intelvi must take into account the changes to the tax rules provided for by the new Border Agreement. The Italy-Switzerland double taxation convention guarantees the non-double taxation of border workers' income.

The Frontier Agreement was signed on 20 January 2018 between the Government of the Italian Republic and the Swiss Government, with the aim of simplifying the tax rules for border workers working in Switzerland and residing in Italy. The treaty entered into force on 1 January 2020.

Border workers who reside in Alta Valle Intelvi and work in Ticino must be aware of the tax rules provided for in the Agreement. In particular, they should know that the incomes of border workers are subject to taxation in Italy and Switzerland, but only in one of the two countries.

According to Article 5 of the Frontier Treaty, the income of frontier workers is subject to taxation in Italy if it is received in the form of salary, salary or allowance. In the case of income received in the form of interest, dividends or capital gains, frontier workers are subject to taxation in Switzerland.

Concrete example: if a frontier worker residing in Alta Valle Intelvi receives a salary of CHF 60,000 per year working in Ticino, he will be subject to taxation in Italy.

Taxation in Italy is regulated by Article 13 of the Consolidated Law on Taxes, which provides for a maximum rate of 35% for the income of

Useful tools to protect your net income

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Key points

If you are a frontier worker living in Alta Valle Intelvi and working in Ticino, it is important to be aware of the tax rules and the advantages offered by the new Frontier Agreement. Check the website of the Italian Ministry of Finance for more information on the advantages of the new Frontier Agreement and the Italy-Switzerland double taxation agreement.

However, if you have any questions about the tax rules for frontier workers, please check the website of the Italian Revenue Agency. Here are some concrete examples and real numbers to help you better understand the situation.

Example 1: Income tax

If you work in Switzerland and live in Italy, you may be subject to income tax in both countries. However, thanks to the Frontier Agreement, you could benefit from a reduction in income tax in Switzerland. For example, if your gross income is CHF 80,000, the income tax in Switzerland could be around CHF 15,000, reduced to CHF 10,000 thanks to the Frontier Agreement.

Example 2: Inheritance tax

If you are a frontier worker and have a property in Italy and another in Switzerland, you may be subject to inheritance tax in both countries. However, thanks to the Frontier Agreement, you could benefit from a reduction in inheritance tax in Switzerland. For example, if the property in Italy has a value of €200,000 and the property in Switzerland has a value of CHF 150,000, the inheritance tax in Switzerland could be

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