Living in Faloppio and working in Ticino as a border worker (cross-border guide)

Context

In a nutshell

• The new Frontier Agreement entered into force on 1 January 2024. - Switzerland and Italy avoid double taxation with the tax credit. - Frontier workers can opt for the transitional regime until 2033.

Key facts

• What: New Frontier Agreement
• When: 1 January 2024
• Where: Ticino, Italy
• Who: Frontiersmen
• Amount: Not specified

The new Frontier Agreement entered into force on 1 January 2024, introducing some significant changes for frontier workers. Switzerland and Italy have signed an agreement to avoid double taxation, which means that border workers will not have to pay taxes twice. In addition, frontier workers can opt for the transitional regime until 2033.

Living in Faloppio and working in Ticino as a border worker: what it means and how it works

For border workers who reside in Faloppio and work in Ticino, the entry into force of the new Frontier Agreement represents important news. Thanks to this agreement, frontier workers can benefit from a more favourable tax regime, avoiding double taxation.

What does double taxation mean?

Double taxation is a phenomenon that occurs when an individual is subject to two different tax systems, which impose it on both. In this case, border workers working in Ticino and residing in Faloppio could be

Operational details

Tax use is one of the most important aspects for frontier workers. Switzerland and Italy have established a tax credit regime to avoid double taxation. This means that border crossers will not have to pay taxes twice. In addition, frontier workers can opt for the transitional regime until 2033, which means that they will not have to pay taxes for a limited period of time. For example, if a border worker works in Ticino and lives in Faloppio, they could benefit from the tax credit scheme. Let's imagine that the border worker works in a company in Bellinzona and earns 60,000 Swiss francs a year. If the income tax in Switzerland is 10%, the frontier worker will have to pay 6,000 Swiss francs per year. However, if the border worker opts for the transitional regime, they may not have to pay taxes for a limited period of time. The transitional regime is valid until 2033 and allows border crossers not to pay taxes for a limited period of time. This means that border crossers will be able to enjoy a tax reduction for a limited period of time. However, it is important to note that this scheme is only valid until 2033. For example, if a border worker works in Ticino and lives in Faloppio, they could benefit from the transitional regime. Let's imagine that the border worker works in a company in Bellinzona and earns 60,000 Swiss francs a year. In addition, it is important to note that frontier workers may also benefit - Income tax in Switzerland is 10% for income up to CHF 60,000 per year. - Income tax in Italy is 20% for income up to 60,000 euros per year. Comparisons between practical scenarios:

Useful tools to protect your net income

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

Key points

For border workers who reside in Faloppio and work in Ticino, it is essential to be informed about the new rules and changes made by the new Border Agreement. This agreement, which entered into force on 1 January 2023, introduces important changes for border workers residing in Switzerland and working in Italy.

It is advisable to consult a lawyer or a financial expert to get a complete view of the changes and their implications. In addition, it is important to be aware of the deadlines and procedures required to join the transitional regime.

Calculation of remuneration

To calculate the remuneration to be paid to frontier workers, it is necessary to consider the new rules on the minimum hourly wage and the changes to the remuneration tables. For example, according to the new law no. 197 of 17 December 2022, the minimum hourly wage in Switzerland is CHF 17.88 per hour for 2023. If a frontier worker works 40 hours per week at a wage of CHF 25 per hour, his monthly wage would be CHF 5,333 per hour.

Transitional regime

To join the transitional regime, border workers must submit an application by 31 December 2023. It is important to note that frontier workers who do not submit the application by the deadline will lose the rights to the benefits of the transitional regime.

Concrete examples

Here are some concrete examples of how the new rules could affect border workers who reside in Faloppio and work in Ticino:

• A frontier that

Evaluating a Ticino job offer? Simulate your net payslip: enter gross salary, marital status and municipality for a detailed breakdown.