Living in Gallarate and working in Ticino: Border Guide (cross-border guide)

Context

In a nutshell

• Permit G: right to work in Ticino from the Italian domicile
• Tax at source: withheld ONLY in Switzerland, not in Italy
• New Agreement: effective January 1, 2024, changes rates and deductibles

Key facts

• What: Frontaliere Gallarate-Ticino (Permit G)
• When: New Agreement from 1 January 2024
• Where: Valichi Chiasso, Brogeda, Gaggiolo
• Who: Switzerland (SECO, AFC/ESTV) and Italy (Revenue Agency, INPS)
• Amount: Deductible €10,000 (new frontier workers), €7,500 (old until 2033)

Those who live in Gallarate and work in Ticino are border workers. Tax on source income is withheld ONLY from Switzerland: no double taxation. Italy, in order to avoid double taxation, applies the tax credit in the EC framework of 730.

The New Frontier Agreement, signed on 23 December 2020 and in force from 1 January 2024, introduced a deductible of €10,000 per year for those who become frontier workers after 17 July 2023. Those who were previously border workers are entitled to an exemption of €7,500 until 2033 (transitional regime).

The tax system for frontier workers

The border tax works like this: the Ticino employer withholds the tax at source on the salary. Switzerland applies federal and cantonal rates (about 5-15% depending on canton and income). But Italy DOES NOT apply additional taxes on frontier labour income: the tax credit avoids double taxation.

What changes with the new agreement? The new

Operational details

Cost of living and pay slip

Many border workers choose Gallarate because the Italian cost of living is lower than in Ticino. Rents, food expenses, gasoline: generally more convenient. However, the advantage must be measured against the net income in Switzerland.

A Ticinese gross salary, with border worker treatment and Ticino cantonal tax rate, generates a net income after AVS/AI/IPG (5.3%) and AD/AC (1.1%) contributions. The net income, converted to EUR, allows for calculating the real purchasing power. The Italian cost of living (rents, food, car) is normally 20–30% lower than in Ticino, so the Gallarate border worker has margins for savings.

However, they must consider fuel, car wear, tolls on A2/A9 (if necessary) and unfavorable CHF/EUR exchange some years. It's convenient to make a personal count with salary calculator for a precise estimate of the border worker's net income.

Pensions: AVS, LPP, and third pillar

The border worker's pay slip includes AVS/AI contributions at the employee's charge (5.3%) paid to Switzerland. This creates rights to old-age pensions managed by federal institutions. The Italy-Switzerland Convention signed on December 9, 1976 (still in force) provides for the computation of work periods for the calculation of the pension: those who have paid both Swiss AVS and Italian INPS can request a coordinated benefit.

LPP (professional pension/second pillar): the Ticinese employer pays 7–18% (depending on the age range from 25 years) into a mandatory pension fund. It's essential that the border worker NOT neglect this protection: at 65/64 years, they will receive capital or pension, or a combination. The third pillar 3a (private savings with deductibility) is optional but useful for extra savings and tax reductions.

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Key points

How to Obtain the G Permit

The G Permit is the document that authorizes an Italian citizen to work in Switzerland as a border worker. It is not a visa, but a work permit. Here's how to obtain it:

Step 1: Find a job offer in Ticino

The Ticinese employer must certify (through SEM, Swiss State Secretariat for Migration) that no Swiss candidate has been found for that role. In some sectors (healthcare, hospitality), it is automatic. Otherwise, the employer submits a request for occupation authorization to SEM (timing: 2-3 weeks).

Step 2: Request the G Permit in Italy

Once the SEM authorizes the position, the border worker requests the G Permit through the competent Questura (Varese). Required documents: valid passport/identity card, job offer letter from the Ticinese employer, SEM certification of authorization, application form, photo, and any additional certificates of previous convictions. The G Permit is valid for 5 years and can be renewed.

Step 3: Register for tax and social security

Once the permit is obtained, the border worker must register with the Cantonal Tax Office of the Canton of Ticino (AFC/ESTV at the federal level). They receive an identification number for the withholding of source tax. In Italy, they must contact the Italian Revenue Agency (for the CE framework of the 730) and declare that they are not registered with the Italian Social Security Institute (INPS, as contributions are paid to Switzerland). The employer provides the AVS insurance number at the time of hiring.

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