Living in Crevoladossola and working in Ticino as a border worker

Context

TL;DR

• New Cross-Border Commuter Agreement applied from 1 January 2024
• Former cross-border commuters remain taxed only in Switzerland (Art. 9 of the 2020 Agreement).
• The threshold of 10,000 euros of art. 4 of Law 83/2023 concerns exclusively income from employment carried out abroad, in a border area or in a neighboring country, on a continuous and exclusive basis, by persons residing in Italy, referred to in art. 1, paragraph 175, of Law 147/2013; it is not a general exemption or an exemption from Swiss withholding tax.

Key facts

• What: New Frontier Workers Agreement
• When: January 1, 2024
• Where: Ticino
• Who: Frontier workers
• Amount: €10'000

Living in Crevoladossola and working in Ticino as a frontier worker

If you are a citizen of a member state of the European Union and live in Crevoladossola, Switzerland, you may have heard of the New Frontier Workers Agreement. This agreement will be applied starting January 1, 2024, and could have a significant impact on your employment situation.

The New Frontier Workers Agreement is an agreement between Switzerland and the European Union that changes the rules for frontier workers. Frontier workers are citizens of a member state of the European Union who work in Switzerland but are not resident in Switzerland. The transitional regime under Art. 9 of the Agreement applies only to those who meet the treaty definition and worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with Italian taxation and a credit for Swiss tax. The 10.000 euro amount under Art. 4 L. 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, L. 147/2013, not a general exemption. AFC fact sheet · Agreement, Art. 9 · Normattiva, Art. 4.

The transitional regime provides that existing frontier workers may continue to work in Switzerland without having to obtain a work permit. However, they will be subject to a stricter monitoring regime and will have to register with the competent authority. The transitional regime under Art. 9 of the Agreement applies only to those who meet the treaty definition and worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with Italian taxation and a credit for Swiss tax. The 10.000 euro amount under Art. 4 L. 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, L. 147/2013, not a general exemption. AFC fact sheet · Agreement, Art. 9 · Normattiva, Art. 4.

But what does all this mean for you? If you are a citizen of a member state of the European Union and live in Crevoladossola, you may have heard of this agreement and how it could affect your employment situation.

Here are some concrete examples to help you understand better:

• If you are an Italian citizen and live in Crevoladossola, you might be considered a frontier worker. If you work in Switzerland, you might have to obtain a work permit and register with the competent authority. If you are a French citizen and live in Crevoladossola, you might be considered a frontier worker. If you work in Switzerland, you might have to obtain a work permit and register with the competent authority. If you are a citizen of a member state of the European Union and live in Crevoladossola, you might have to take the rules of the new Frontier Workers Agreement into account.

To help you better understand the rules of the new Frontier Workers Agreement, here is an operational checklist:

• Check whether you are considered a frontier worker
• Check whether you need to obtain a work permit
• Check whether you need to register with the competent authority
• Check whether an exemption applies to you
• Check whether you need to take the transitional regime into account

In addition, here are some comparisons between practical scenarios:

• If you are a citizen of a member state of the European Union and live in Crevoladossola, you might have to obtain a work permit to work in Switzerland.

In conclusion, the New Frontier Workers Agreement is an important agreement that could have a significant impact on your employment situation. It is important that you understand the rules of the new agreement and ensure that you are in good standing with the competent authorities.

Legal references

• Agreement between Switzerland and the European Union on the status of frontier workers (2024)
• Immigration Regulation (2024)
• Federal Immigration Decree (2024)

Concrete examples

• An Italian citizen who works in Switzerland and lives in Crevoladossola might have to obtain a work permit and register with the competent authority. A French citizen who works in Switzerland and lives in Crevoladossola might have to obtain a work permit and register with the competent authority. A citizen of a member state of the European Union who works in Switzerland and lives in Crevoladossola might have to obtain a work permit and register with the competent authority.

Operational checklist

Comparisons between practical scenarios

Operational details

Income tax at source is ONLY withheld in Switzerland for frontier workers, thanks to the Italian tax credit that avoids double taxation. The €10,000 threshold in Article 4 of Italian Law No. 83/2023 applies exclusively to employment income earned continuously and exclusively by Italian residents in a foreign border area or neighbouring country, as referred to in Article 1(175) of Law No. 147/2013; it is neither a general allowance nor an exemption from Swiss withholding tax.

If you want to work in Ticino as a border worker and reside in Crevoladossola, it is essential to understand income tax regulations. Under Italian law, frontier employees are not subject to income tax in Italy, provided they are not resident in Italy.

However, cross-border employees are subject to income tax in Switzerland. Income tax at source is withheld directly from the employer, who then reimburses the tax to the employee. The Italian tax credit avoids double taxation, as the tax paid in Switzerland is recognized as tax already paid in Italy.

It is important to note that the deductible or exemption does not apply to salaries above these amounts.

For example, if a frontier worker has an annual income of €60,000, the income tax in Switzerland will be around €10,000 (€60,000 - €50,000 = €10,000). However, if the frontier worker has an annual income of €40,000, the income tax in Switzerland will be about

Useful tools to protect your net income

To reduce FX leakage, compare CHF-EUR exchange options and banks for cross-border workers.

Key points

To work in Ticino as a border worker, you must obtain a G Permit. This document allows frontier workers to work in Switzerland, without having to be registered on the list of inhabitants of the canton. You can apply to join the list of those entitled to the refund, which allows you to avoid paying the tax at source in Switzerland. This option can be advantageous for those who intend to work in Ticino, but do not reside in the canton.

For example, if you work in Lugano and reside in Crevoladossola, you can request registration on the list of those entitled to refreshments. According to Ticino law, the tax at source in Switzerland is 5% for incomes up to CHF 150,000 per year. If you are on the list, you will not have to pay this tax.

You can also opt for LAMal health insurance. This insurance is mandatory for all workers in Switzerland and covers the costs of care and treatment in the event of illness. LAMal insurance is managed by the State and covers up to 70% of care costs.

To apply for registration on the list of those entitled to the refreshment, you must submit an application to the Council of State of the Canton of Ticino. The application must be accompanied by a set of documents, including identity card, birth certificate and residence certificate.

Here is an operational checklist to request registration on the list of holders

First day as a cross-border worker? Our practical guide walks you from cantonal registration to your first paycheck.