Living in Brissago-Valtravaglia, working in Ticino: border guide (cross-border guide)

Context

Brief Summary

• Income tax paid only in Switzerland, never in double
• New Frontier Agreement in force from January 1, 2024
• Tax exemption: CHF 7,500 (pre-2023 frontier workers) or CHF 10,000 (new)
• G Permit is the basis for regular cross-border work

Key Facts

• What: Italian residency, work in Ticino, frontier worker status
• When: New Agreement from January 1, 2024 (Law 83/2023)
• Where: Brissago-Valtravaglia, Lake Maggiore
• Who: Italian-Swiss frontier workers with G Permit
• Exemption: CHF 7,500-CHF 10,000 per year until the end of 2033
• Tax: 5.3% AVS/AI/IPG dependent in Switzerland

The New Frontier Agreement, signed on December 23, 2020, and entered into force on January 1, 2024 (ratified by Italy with Law 83 of June 13, 2023), has established a new tax regime for those living in Italy and working in Switzerland. If you live in Brissago-Valtravaglia and work in Ticino, this agreement directly concerns you and redefines your tax, contributory, and insurance obligations.

The fundamental rule is crystal clear: income tax on earnings is paid only in Switzerland, where your employer makes monthly deductions on your paycheck. Italy does not apply double taxation thanks to the tax credit recognized in the EU framework of the model 730, which automatically compensates the taxes already paid to the Swiss tax authority.

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Operational details

How does frontier taxation work in Switzerland

Switzerland applies a withholding tax on income earned in Swiss territory. If you earn CHF 50,000 in gross income per year, here's what happens in your paycheck and how to calculate your net income.

Swiss withholding tax on your paycheck

The AVS/AI/IPG (invalidity insurance, daily allowance) is 5.3% of your gross salary, paid by the employee. In addition, the unemployment insurance (AD/AC) is 1.1% up to CHF 148,200 in annual income, and the accident insurance (LAINF) is between 0.7% and 1.5%. For the LPP (second pillar pension), the rates vary between 7% and 18% depending on the age range (25 years and above).

In addition to these social contributions, the employer deducts the Ticino cantonal and municipal tax on the source. The rates are applied according to the Italian-Swiss Convention (December 9, 1976) and administered by the cantonal authorities.

Double taxation: Italian tax credit protects you

The income from dependent work in Switzerland must be declared in the Italian model 730. However, double taxation is avoided through the tax credit in the CE framework: Italy recognizes the taxes already paid in Switzerland and reduces the Italian IRPEF accordingly.

If you live in Brissago-Valtravaglia with an Italian residence, you are required to pay a portion of the Italian IRPEF? Only on the part of the income that exceeds the exemption. With the exemption of EUR 7,500 (or EUR 10,000 for new frontiers), the taxable base in Italy decreases significantly. The Italian IRPEF is applied according to progressive rates: 23% up to EUR 28,000, 35% between EUR 28,001 and EUR 50,000, and 43% above EUR 50,000.

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Key points

Practical Procedure: How to Relocate to Brissago-Valtravaglia

If you decide to live in Brissago-Valtravaglia and work in Ticino, follow these steps to regularize your position.

Step 1: Obtain the G Permit

Contact the cantonal authorities in Ticino (Migration Section or equivalent office in your district). The G Permit is usually issued to those with a work contract with a Ticinese company. You will need: a valid passport or identity document, a signed employment contract, and completed forms according to cantonal guidelines. The release times are usually 2-4 weeks.

Step 2: INPS Registration and Italian Residency

Although you work in Switzerland, you must register with the Italian INPS as a 'worker resident in Italy with foreign income.' This activates your Italian pension contributions in synchronization with the Swiss AVS. Visit the INPS in person or online; you will need your CUIC (Citizen Identification Code) and your Swiss employment contract.

Step 3: Municipal Anagraphic Registration

Transfer your anagraphic residence to the Comune of Brissago-Valtravaglia. This is a prerequisite for obtaining the G Permit and being recognized as a 'resident in Italy' by the Revenue Agency and INPS. You will need identity documents, a previous residence certificate, and a completed application.

Step 4: Income Tax Declaration (Model 730)

Every year, by June 30 (or July 31 if through an intermediary), you will submit the Model 730 to the Italian Revenue Agency. Here, you will declare all income earned in Switzerland, and benefit from the tax credit to avoid double taxation. The Model 730 must be completed with all Swiss withholdings declared in the income certificate.

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