Living in Mazzo di Valtellina and working in Grisons: border guide (cross-border guide)

Context

In a nutshell

• From 1 January 2024, the New Frontier Agreement regulates deductibles and tax deadlines.
• Excess €10,000 for new border workers, €7,500 for those who were already border workers as of July 17, 2023.
• Tax at source withheld only in Switzerland; Italian tax credit in form 730 avoids double taxation.
• AVS (5.3%) and LAMal contributions mandatory from the first day of Swiss employment.

Key facts

• What: New frontier tax and social security system
• When: Effective January 1, 2024
• Where: Switzerland (Graubünden) and Italy (Lombardy, Valtellina)
• Who: SECO, AFC/ESTV, INPS, Revenue Agency, Canton of Graubünden
• Deductible: €10,000 (new frontier workers), €7,500 (old until 31/12/2033)
• Source tax: Withheld only in Switzerland
• Pension: AVS 5.3% compulsory, LPP 7–18% by age group
• Double taxation: Avoided by Italian tax credit (CE framework, model 730)

The border regime between Valtellina and Graubünden

Those who reside in Mazzo di Valtellina in Lombardy and work in the Swiss Graubünden acquire the status of G category border worker. This regime is governed by the New Frontier Agreement, which entered into force on 1 January 2024, which modified deadlines, deductibles and procedures compared to the previous system.

The New Agreement was signed on 23 December 2020 and ratified by Italy with Law 83 of 13 June 2023. The Double Taxation Convention between Italy and

Operational details

Paycheck and mandatory contributions

The paycheck of a border worker working in the Graubünden registers withholdings that the employer pays to the competent authorities. The main one is the cantonal and municipal source tax, calculated on the basis of the canton and the municipality of work.

In addition to the tax, the frontier worker pays mandatory Swiss contributions directly from the gross salary:

• AVS (Old Age and Disability Insurance): 5.3% to be paid by the employee
• LAINF (Non-occupational Accident Insurance): 0.7% – 1.5%
• LPP (Occupational pension, second pillar): 7% – 18% depending on the age group (from 25 years)

These contributions are mandatory from the first day of work in Switzerland, regardless of residence. The total sum of AVS + LAINF + LPP can reach 20-25% of the gross salary, depending on age and company pension fund.

In Italy, the border worker remains tax resident but is not obliged to pay INPS contributions if he is only an employee in Switzerland.

How the tax refund works

The refund is the reimbursement of the Swiss withholding tax (at source) that the border worker obtains by filing a declaration with the Tax Administration of the canton of work within the terms of the law.

Basic procedure: 1. Receive the total amount of withholding withheld from the annual paycheck 2. File a declaration with the Tax Office of the canton of Graubünden 3. If the withholding tax is higher than the tax

Useful planning tools

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

Key points

Checklist practice: concrete steps

If you decide to transfer your residence to Mazzo di Valtellina and accept a job in the Grisons, follow these steps.

Step 1: Verify the G permit

Before signing the contract, inform your employer that you are a resident in Italy. The employer is required to verify with SECO (Swiss State Secretariat for Economic Affairs) that you are an admitted border crosser. In general, the Grisons canton handles this verification automatically for new employees.

Step 2: AVS/LPP registration

After the first salary payment, your employer will inform you of the assigned AVS number. Register with the LPP (professional pension) fund chosen by the company. This occurs automatically; you should receive the documents and keep them.

Step 3: Health insurance (LAMal)

Within three months of starting work, you must be covered by LAMal or Italian health insurance. If you choose Swiss LAMal, contact a Grisons health insurance fund and sign a policy. The contract usually starts from the month following the request.

Step 4: Swiss tax declaration

At the end of the year, you will receive from the pay slip the total amount of withholding tax. Within the cantonal deadlines (usually April of the following year), submit a declaration to the Grisons tax office. You can do this online through the cantonal portal or with the help of a Swiss tax consultant.

Step 5: Italian tax declaration (730)

At the same time, use the 730 model at an Italian CAF to declare your Swiss income and tax credit. You can delegate a tax consultant or complete the 730 online through the Italian Revenue Agency.

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