Living in La Thuile and working in Valais as a border worker (cross-border guide)

Context

In a nutshell

• Italy avoids double taxation with the tax credit (EC framework of 730)
• The New Frontier Agreement was signed on 23 December 2020 and will be in force from 1 January 2024
• Old frontier workers are entitled to an exemption of 7,500 euros, while new frontier workers have an exemption of 10,000 euros

Living in La Thuile and working in Valais as a border worker

Ticino is one of the most attractive regions for frontier workers, thanks to its geographical location and expanding economy. A concrete example is the border community that lives in La Thuile, a municipality located in the Aosta Valley, but with many connections to the Ticino region.

For frontier workers, the choice to live in La Thuile and work in Valais is often dictated by the need to find a stable and well-paid job. In this sense, the New Frontier Agreement signed on 23 December 2020 offers many opportunities. From 1 January 2024, frontier workers will be able to enjoy a more favourable tax regime, thanks to the double taxation tax credit.

But what exactly does the New Frontier Agreement mean for frontier workers? First of all, it is important to note that old frontier workers are entitled to an exemption of 7,500 euros, while new frontier workers have a deductible of 10,000 euros. This means that frontier workers can enjoy a greater tax exemption, without

Operational details

Key facts

• Tax at source: only withheld in Switzerland for border crossers
• New Frontier Agreement: signed on 23 December 2020 and in force from 1 January 2024
• Exemption for old border workers: 7,500 euros
• Deductible for new frontier workers: 10,000 euros

Working as a border worker in Ticino: what does it mean?

If you are a cross-border worker living in La Thuile and working in Valais, you have probably heard of the New Frontier Agreement. This agreement, signed on 23 December 2020, entered into force on 1 January 2024 and changes the rules for cross-border workers.

Tax at source: how does it work?

Tax at source is a tax that is withheld from workers' wages. In Switzerland, this tax is only withheld for cross-border workers. The New Frontier Agreement provides that this tax is only withheld in Switzerland, instead of being paid in both Italy and Switzerland.

Concrete example: how does the deductible work?

Let's say you are a cross-border worker earning 4,000 euros per month. The deductible for new frontier workers is 10,000 euros per year. This means that if your annual income is less than €10,000, you will not pay the Tax at source. In our example, your annual income would be 48,000 euros (4,000 euros per month x 12 months), so you would pay the Tax at source only on sums over 10,000 euros.

Concrete example: how it works

Useful tools to protect your net income

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Key points

Procedure

• To take advantage of the €10,000 deductible, new frontier workers must submit their tax return by 31 March of the following year
• Old frontier workers can opt for the 7,500 euro deductible, but must submit their tax return by 31 March of the following year

Live in La Thuile and work in Valais as a border worker: the advantages

Living in La Thuile and working in Valais as a border worker can be a great choice for those looking to save money and enjoy a quieter life. La Thuile, a municipality in the province of Aosta, is an ideal place for those who love nature and tranquility. Valais, on the other hand, offers a variety of job opportunities, thanks to its solid and dynamic economy.

How the deductible works

The deductible is a tax benefit that allows frontier workers to avoid paying taxes on their income. To take advantage of this allowance, frontier workers must reside in Switzerland for at least 183 days per year. The deductible is 10,000 euros for new frontier workers and 7,500 euros for old frontier workers.

Concrete examples

Suppose a frontier worker resides in La Thuile and works in Valais. If he earns €50,000 per year, he could take advantage of the €10,000 deductible and only pay taxes on the remaining income (€40,000). This would mean a saving of about 10,000 euros per year.

Operational Checklists

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