What is the difference between the €10,000 and €7,500 deductible?

The New Cross-Border Commuter Agreement, which came into force on 1 January 2024, established two regimes. If you were already working in Switzerland on 17 July 2023, you keep the €7,500 deductible under the transitional regime until 2033. If you start as a cross-border commuter after that date, you are entitled to a deductible of €10,000 per year. The deductible is tax-free gross income in the Italian tax system, so with €10,000 you do not pay IRPEF in Italy.

Are AVS and LPP mandatory even if I work for a few months in Switzerland?

Yes. From the first day of work in Switzerland, the AHV (5.3% employee rate) and the ADD (1.1%) are mandatory and paid by your employer. The BVG (second pillar) comes into force at the age of 25 and varies from 7% to 18% depending on the age group. If you only work 3 months, the contributions are proportional, but you cannot exempt yourself from them.

Can I choose between Swiss (LAMal) and Italian health insurance?

Yes, cross-border commuters with a G permit are entitled to option. You can join LAMal (Swiss insurance, with deductibles CHF 300–2,500 per year) or remain in the Italian MAI. The choice must be communicated within 3 months of the start of the employment relationship. Many choose KVG because it covers the entire Swiss territory without geographical barriers.

How does the Italian tax return for Swiss income work?

In the Italian tax return (730 or PF Income), fill in the EC form and report the income from foreign employment (Switzerland), the withholdings made, and the applicable deductible (€10,000 or €7,500). The Revenue Agency calculates the tax credit: if the Swiss taxes exceed the Italian taxes due, you receive a refund; otherwise you pay the delta in Italy.

Living in Mornago, working in Ticino: taxation and permit G (cross-border guide)

Di Marco Ferrari · Published on 2 September 2026

Border between Ticino and Lombardy from Mendrisio towards Mornago, with green Varese hills in the distance

From 1 January 2024, the New Frontier Agreement guarantees a €10,000 exemption to new frontier workers. Discover taxation, AVS, LPP and LAMal for those who live in Mornago and work in Ticino.

Context

In brief

Withholding tax only in Switzerland, no double taxation
Exemption €10,000 per year (new cross-border workers), transitional regime until 2033
AVS and LAMal mandatory; LPP from 7-18% depending on age group
Permit G allows unrestricted access to the Ticino labor market

Key facts

What: Working in Ticino while residing in Mornago as a cross-border worker
When: From January 1, 2024 (entry into force of the New Cross-Border Workers Agreement, signed on December 23, 2020)
Where: Mornago (Varese province, Italy) → Canton Ticino (Switzerland)
Who: Cross-border workers with Permit G and an employment contract
Exemption: €10,000 annually (new cross-border workers from July 17, 2023 onwards)
AVS rate (employee): 5.3% on gross salary

Working in Canton Ticino while living in Mornago is a well-established choice for professionals in the province of Varese. The Italy-Switzerland Double Taxation Convention, signed on December 9, 1976, has eliminated the risk of paying taxes in both countries. For cross-border workers, a specific rule applies: the withholding tax is deducted exclusively by Switzerland, not by Italy. Italy recognizes the tax credit through the CE section of the 730 declaration.

Permit G is the essential document for those living in Mornago and working in Ticino. It is not a temporary visa but a work permit that allows unrestricted access to the Ticino labor market without sectoral restrictions. The application is submitted to the SEM (State Secretariat for Migration) with the employment contract signed by the Swiss company and the Italian identity document.

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Operational details

Taxation and withholding tax in Switzerland

The Swiss withholding tax is the basis of the tax system for cross-border commuters. Unlike many European countries, Switzerland deducts taxes directly from the paycheck and transfers them to the cantonal administration. For those living in Mornago and working in Ticino, this means there is no double direct taxation: Italy does not withhold additional national taxes on foreign employment income but recognizes the Swiss tax credit in the income tax return through the CE section of the 730 form or the Redditi PF declaration.

The withholding tax rate varies by canton. The Canton of Ticino applies combined federal and cantonal rates: the federal part is set according to a progressive table (from about 6% to about 13% depending on income), and the cantonal part is added to this. A person earning CHF 50,000 annually will have a total deduction (tax + social contributions) significantly lower than Italian taxation on an equivalent income in euros.

The New Cross-Border Agreement, which came into effect on January 1, 2024, has profoundly changed the tax treatment. For new cross-border commuters (those who started after July 17, 2023), the annual exemption has been increased from €7,500 to €10,000, with a gradual reduction in the transitional period 2024–2033. Cross-border commuters already employed retain their acquired rights: they remain tax-exempt up to €7,500 annually until 2033, after which the exemption drops to €5,000. This structure offers protection for low and medium incomes, typical of the province of Varese.

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Key points

## Health insurance: LAMal and right of option for G border workers Border workers with G Permit have an explicit right of option on health coverage. They can choose to join the LAMal (Swiss Health Insurance, mandatory for Swiss residents) or stay in the Italian system with the CMI (Maternity-Invalidity-Igiene Coverage). The choice must be communicated in writing within 3 months of the start of the employment relationship. Many border workers opt for LAMal because Ticino health facilities are accessible without geographical barriers, and covered services include general practitioners, hospitalisation, prescription drugs and specialist services throughout Switzerland. LAMal adult deductibles range from CHF 300 (minimum deductible, with higher premium) to CHF 2,500 (maximum deductible, with lower premium). The choice of the franchise is annual and allows you to modulate the cost of coverage according to your personal needs. Those with reduced medical expenses can choose a high deductible and contain the monthly premium; those with chronic diseases or who often access benefits opt for a low deductible. The participation in expenses (copayment) is fixed at 10% after reaching the deductible (up to an annual ceiling of CHF 700 for outpatient medical costs only). The Italian CMI, an alternative for those who remain in the Italian system, is managed by INPS and covers the essential services of medicine - Net estimate: Use the calcolatore di stipendio to enter the Swiss gross and see the approximate net (consider AVS 5.3%, ADD 1.1%, LPP 7–18%, source tax 6–13%, Italian deductible €10,000). - Cost of living: Compare rent, groceries and utilities in Mornago with your estimated net. A rule of thumb: Rent should not exceed 30% of your monthly net. - Health insurance: Request quotes from 2–3 LAMal insurers to compare premiums (CHF 300 vs CHF 2,500 franchise) and covered benefits. - Identity documents: Make sure your passport or ID card is valid for at least 6 months. The SEM may require criminal records or residency certificates. - Second language: If your Italian is not a native speaker, or if the canton of Ticino requires a language interview, prepare a certificate of linguistic competence (DALF, DELE, Goethe-Institut test, or notarial self-declaration). Next steps: Log in to calcolatore di stipendio and enter your proposed gross. Compare the net with the monthly costs of accommodation, transport and food in Mornago. If the margin is comfortable, proceed with signing the contract and requesting the G Permit. Once you receive your AVS number, you can sign up for LAMal insurance and start working in Ticino with full social coverage.

Frequently Asked Questions

If I work in Ticino and live in Mornago, do I pay taxes in Switzerland or Italy?: Withholding tax is withheld exclusively in Switzerland by your employer and paid to the cantonal administration. Italy does not withhold additional taxes on foreign employment income, but recognizes the tax credit in your tax return (EC framework of 730). There is no double taxation thanks to the Italian-Swiss Convention of 9 December 1976.
What is the difference between the €10,000 and €7,500 deductible?: The New Cross-Border Commuter Agreement, which came into force on 1 January 2024, established two regimes. If you were already working in Switzerland on 17 July 2023, you keep the €7,500 deductible under the transitional regime until 2033. If you start as a cross-border commuter after that date, you are entitled to a deductible of €10,000 per year. The deductible is tax-free gross income in the Italian tax system, so with €10,000 you do not pay IRPEF in Italy.
Are AVS and LPP mandatory even if I work for a few months in Switzerland?: Yes. From the first day of work in Switzerland, the AHV (5.3% employee rate) and the ADD (1.1%) are mandatory and paid by your employer. The BVG (second pillar) comes into force at the age of 25 and varies from 7% to 18% depending on the age group. If you only work 3 months, the contributions are proportional, but you cannot exempt yourself from them.
Can I choose between Swiss (LAMal) and Italian health insurance?: Yes, cross-border commuters with a G permit are entitled to option. You can join LAMal (Swiss insurance, with deductibles CHF 300–2,500 per year) or remain in the Italian MAI. The choice must be communicated within 3 months of the start of the employment relationship. Many choose KVG because it covers the entire Swiss territory without geographical barriers.
How does the Italian tax return for Swiss income work?: In the Italian tax return (730 or PF Income), fill in the EC form and report the income from foreign employment (Switzerland), the withholdings made, and the applicable deductible (€10,000 or €7,500). The Revenue Agency calculates the tax credit: if the Swiss taxes exceed the Italian taxes due, you receive a refund; otherwise you pay the delta in Italy.