Living in Gravedona and the United States, working in Ticino as a border worker

Context

In brief

• Living in Italy (Gravedona) and working in Switzerland (Ticino): cross-border regime with G permit
• Withholding tax deducted in Switzerland, tax credit in Italy (form 730, section CE)
• New Cross-Border Agreement from January 1, 2024: exemption CHF 7,500 (old) or CHF 10,000 (new)
• AVS/LPP/LAMal: mandatory Swiss contributions and social security for cross-border workers

Key facts

• What: New Cross-Border Agreement between Italy and Switzerland with tax exemption regimes
• When: Signed on December 23, 2020, effective from January 1, 2024 (Law 83/2023 IT)
• Where: Cross-border workers Como-Ticino, residents in Italy, workers in Switzerland
• Exemption amount: CHF 7,500 for old cross-border workers (registered before 17/7/2023), CHF 10,000 for new ones
• Tax: Deducted solely in Switzerland, tax credit in Italy
• Double taxation agreement: Signed on March 9, 1976, prevents double taxation
• Permit: G permit for cross-border workers (seasonal 4-12 months), issued by SEM (Migration Section)
• LAMal: Cross-border workers with G permit have the option between Swiss LAMal and Italian CMI

Living in Gravedona ed Uniti, in the province of Como, and working in Ticino as a cross-border worker means adhering to specific tax rules, permits, and social security. The New Cross-Border Agreement, signed on December 23, 2020, and effective from January 1, 2024 (Italian ratification: Law 83 of June 13, 2023), has established the tax regime for cross-border commuters. The withholding tax is deducted solely in Switzerland, while in Italy, the tax credit is applied through form 730 (section CE). For old cross-border workers, already registered before July 17, 2023, an exemption of CHF 7,500 applies with a transitional regime until 2033. New cross-border workers benefit from a CHF 10,000 allowance. These elements determine the net monthly salary and must be carefully evaluated before choosing Gravedona as a residential base.

G Permit and cross-border residence

To live in Gravedona ed Uniti and work in Ticino, the cross-border worker must have a G permit (seasonal 4-12 months) or actual residence in Switzerland (B permit). The G permit is issued by the Migration Section (SEM) and allows the exercise of dependent activity in Switzerland while maintaining residence in Italy. Choosing to reside in Gravedona, in the province of Como, places the cross-border worker in a specific Italy-Switzerland tax regime regulated by the Double Taxation Agreement signed on March 9, 1976. This agreement ensures that employment income is taxed solely in the country of employment (Switzerland), avoiding double taxation.

Taxation: withholding tax and tax credit

The withholding tax on employment income is deducted solely by Switzerland. Italy does not apply additional taxes on employment income for cross-border workers with a G permit but allows the recovery of the tax credit in form 730 (section CE), summing the Swiss tax paid and the worldwide income declared in Italy. Swiss federal rates vary based on the canton and personal conditions; the Canton of Ticino applies specific brackets. There is no double taxation but a single payment in Switzerland and partial recovery in Italy. This mechanism is crucial for planning the net salary and expected annual taxes.

Social contributions and pensions

A cross-border worker residing in Gravedona and working in Ticino pays Swiss social contributions. AVS/AI (old-age and disability insurance) involves a 5.3% rate for the employee, while the employer pays the same percentage. Unemployment insurance (AD/AC) is 1.1% (employee) up to an annual salary limit of CHF 148,200. Accident insurance (LAINF) is 0.7-1.5%. These contributions are mandatory and feed the Swiss pension system (first pillar AVS) and professional pension (second pillar LPP), where the employee pays a share between 7% and 18% depending on the age group (mandatory from the 25th year of life). To learn more about planning your future pension and understanding AVS/LPP, consult our dedicated tools. In Italy, the cross-border worker DOES NOT pay additional INPS contributions for Swiss employment income, but the Swiss contribution career counts for the Italian pension through the totalization of contribution periods between the two countries.

Operational details

Health Insurance and Choice Between LAMal and CMI

A border worker with Permit G can choose to insure with a Swiss health insurance fund (LAMal) or maintain Italian coverage (CMI). This right of choice is enshrined in the New Border Workers Agreement. If they opt for LAMal, they will choose a deductible between CHF 300 and CHF 2,500 (adults). If they remain with CMI, they maintain the basic Italian coverage (SSN) and can supplement it with additional policies. The choice has implications for the monthly cost and the network of hospitals that can be used (Ticino hospitals vs. Lombardy hospitals). Many border workers from Como who live in Gravedona choose CMI to maintain continuity with doctors and hospitals in the province.

Border Workers Agreement and Transitional Regimes

The New Border Workers Agreement, in force from January 1, 2024, introduces income brackets with temporary tax exemptions. Border workers already registered before July 17, 2023 (old border workers) benefit from an annual exemption of CHF 7,500 within a transitional regime that covers the decade 2024–2033. New border workers (registered from July 17, 2023 onwards) have access to an annual exemption of CHF 10,000 without a time limit. This difference directly impacts the Swiss taxable income and, consequently, the withholding tax. A border worker resident in Gravedona must verify their registration as an old or new border worker with their Ticino employer or with the Swiss tax authorities (AFC, Federal Tax Administration). The status determines the annual tax savings.

Border Crossings and Connection to Ticino

Gravedona ed Uniti is located in the province of Como, not far from the main border crossings with Ticino (Brogeda, Chiasso, Gaggiolo, Ponte Tresa). The proximity to the crossings is a decisive factor in the choice of residence, as it affects daily travel times and the practicality of commuting. Each border worker should check the current schedules of public transport (trains, buses) and traffic conditions at the crossings before signing a lease or purchase contract. Additionally, a net salary calculator on our site allows you to simulate the impact of withholding tax and Swiss contributions on the monthly net salary by entering the gross salary and border worker status. Furthermore, a CHF/EUR comparator allows you to evaluate the currency exchange rate to plan the monthly budget in a bilateral perspective.

Useful planning tools

To estimate your pension strategy, use the pension planner and the pillar 3 simulator.

Key points

Step 1: Check your status as an old or new frontier worker

Before moving to Gravedona, it is essential to determine whether you are an 'old frontier worker' (registered before July 17, 2023) or a 'new frontier worker' (registered from July 17, 2023 onwards). This status directly impacts your tax exemption (CHF 7,500 vs. CHF 10,000). Contact your Ticino employer or the Swiss tax authorities (AFC, Federal Tax Administration) to confirm your status. This is not a given and can make a difference of hundreds of francs per year on Swiss federal taxation.

Step 2: Choose your health insurance scheme

Within the terms set by the New Agreement, decide whether to join LAMal (Swiss) or maintain CMI (Italian). This choice affects your monthly premium, deductible, and available healthcare network. If you choose LAMal, select the deductible that best suits your profile (CHF 300-2,500 for adults). If you stay with CMI, ensure that your Italian coverage is sufficient for care in Switzerland (emergency hospitalization). Contact providers of both systems to compare monthly costs and included services.

Step 3: Plan your annual tax return

A frontier worker residing in Gravedona must complete two annual tax returns: in Switzerland with the Ticino cantonal tax authorities (if the canton requires a return), and in Italy using form 730 or 1040 (if without an employer CUD) in section CE (foreign tax credit), attaching Swiss tax statements. This procedure is mandatory annually and allows you to reclaim the tax credit and verify that double taxation has not been applied. Consulting a tax specialist in frontier workers is recommended, as calculating the tax credit requires precision and knowledge of the Italy-Switzerland treaties.

Step 4: Register with the Municipality of Gravedona

Once you have found accommodation in Gravedona ed Uniti, register with the municipal registry as a resident. This is mandatory under Italian law. The Municipality will issue a residence certificate, essential for obtaining a tax code (if not already in possession), for opening bank accounts, for registering your employment contract with INPS (even though the work is in Switzerland), and for other Italian administrative procedures. The declared residence is the legal starting point for all cross-border tax and pension management.

Tools for financial planning

The overview of the New Frontier Workers Agreement, the Italo-Swiss tax system, and mandatory pension schemes is complex, but addressing it before moving to Gravedona is essential. Every frontier worker should take the time to understand withholding tax, tax credit, exemption brackets, and the Swiss pension system (AVS/LPP/LAMal) before signing an employment contract. Use our net salary calculator to simulate your net salary based on your frontier worker status and gross salary: it is the first concrete step in planning your move to Gravedona and employment in Ticino.