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

Context

The New Frontier Agreement was signed on 23 December 2020 and enters into force on 1 January 2024. This agreement changed the rules for frontier workers residing in Italy and working in Switzerland. Former frontier workers benefit from an exemption of CHF 7,500, with a transitional regime until 2033. The new frontier workers have a deductible of CHF 10,000.

The Italy-Switzerland Double Taxation Convention was signed on 9 December 1976. This convention was updated in 2010 to include new provisions relating to the incomes of frontier workers.

If you are a frontier worker residing in Buguggiate and working in Ticino, it is important to understand how the new agreement works. First, you need to check if you are a former border worker or a new border worker. If you are a former frontier worker, you will benefit from the CHF 7,500 exemption. If you are a new frontier worker, you will have a deductible of CHF 10,000.

Here is a concrete example: if you have an income of CHF 60,000 per year and you work 200 days a year in Ticino, you will benefit from the exemption of CHF7,500 if you are a former border worker. If you are a new frontier worker, you will have a deductible of CHF 10,000, so you will not pay income taxes up to this amount.

Here's a checklist to help you understand how the new agreement works:

• Check if you are a former border worker or a new border worker
• Check if you have an income of CHF 60,000 per year or less
• Check if you worked 200 days a year in Ticino or

Operational details

Former frontier workers benefit from an exemption of CHF 7,500, with a transitional regime until 2033. The new frontier workers have a deductible of CHF 10,000. The Italy-Switzerland Double Taxation Convention was signed on 9 December 1976.

Switzerland is a country with a complex tax system and many rules to abide by. For former frontier workers, the CHF 7,500 exemption is an important benefit, but it is important to know that this transitional regime is only valid until 2033. 📊

For example, if a former frontier worker lives in Buguggiate and works in Ticino, he could benefit from the exemption of CHF 7,500. However, if your income exceeds CHF 100,000 per year, you may be subject to a higher tax. ⚠️

The new frontier workers, on the other hand, have a deductible of CHF 10,000. This means they can earn up to CHF 10,000 per year without being subject to a tax. However, if their income exceeds CHF 10,000, they may be subject to a higher tax.

Concrete example:

• A frontier worker lives in Buguggiate and works in Ticino as an entrepreneur.
• His annual income is 120'000 CHF.
• You could benefit from the CHF 7,500 exemption as a former frontier worker.
• However, you may be subject to a 20% higher tax on income overCHF 100,000.

The Italy-Switzerland Double Taxation Convention was signed on 9 December 1976. This means that Italians working in Switzerland are not subject to double taxation.

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Key points

For border workers resident in Buguggiate (VA) and employed in Ticino, tax planning requires attention to specific regulations and deductible opportunities. In addition to the Italy-Switzerland Double Taxation Convention of 9 December 1976 (supplemented by the 2018 Protocol), it is crucial to understand the obligations in both countries. In Ticino, the average cantonal tax rate stands at 11-13%, lower than 23-43% in Lombardy, but Swiss social contributions (AHV/IV/EO) account for 8.7% of gross income.

"The flat-rate allowance of CHF 10,000 for new frontier workers covers transport and food costs, but only in the first year of operation" (Source: DFDP Circular 2023).

Practical example: a Buguggiate worker hired in Lugano (50 km away) with a gross annual salary of CHF 80,000:

• First year: Ticino taxation with flat-rate deduction 10,000 CHF taxable → income 70,000 CHF.
• Subsequent years: deduction of real costs (e.g. 300 CHF/month transport + 1,200 CHF food) → taxable ≈ 74,400 CHF.

Operational checklist:

• Request G (border) permit within 14 days of hiring.
• Register with AIRE within 12 months.
• Submit the "Frontalieri" form to the Italian Revenue Agency by 30 June of the following year.
• Keep transport receipts (e.g. TPL Lugano subscription: CHF 720/year).

Scenario comparison Frontier in Bellinzona (35 km from Buguggiate): costs

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