Moving to Germignaga by border crossing: pros and cons (cross-border guide)

Context

In a nutshell

• New border agreement from 1 January 2024
• Tax at source in Switzerland for frontier workers
• Tax credit in Italy to avoid double taxation

Key facts

• What: new border agreement
• When: 1 January 2024
• Where: Switzerland and Italy
• Who: frontier workers
• Amount: not specified

The new border agreement entered into force on 1 January 2024. This agreement provides for frontier workers to be subject to tax at source in Switzerland, while in Italy there will be a tax credit to avoid double taxation.

How the agreement works

The frontier agreement was concluded between Switzerland and Italy to regulate tax issues related to frontier workers. Under this agreement, frontier workers working in Switzerland will be subject to tax at source in Switzerland, while in Italy there will be a tax credit to avoid double taxation.

Concrete examples

Imagine you have a border worker working in Germignaga, Switzerland, earning CHF 60,000 a year. According to the border agreement, this worker will be subject to tax at source in Switzerland. The tax at source in Switzerland is 20%, so the worker should pay CHF 12,000 per year in Switzerland.

In Italy, the worker may apply for a tax credit to avoid double taxation. The tax credit in Italy is 15% of income, so the worker can apply for a credit

Operational details

The tax at source in Switzerland for frontier workers is 5.3% for employees and 1.1% for the self-employed. The deductible for new frontier workers is CHF 10,000. Old frontier workers, on the other hand, have a deductible of CHF 7,500 and are subject to a transitional regime from 2024 to 2033.

If you decide to move to Germignaga as a frontier worker, it is important to know the advantages and disadvantages of this choice. Germignaga, in fact, is a municipality in the district of Locarno, Switzerland, which offers a high quality of life and an enchanting natural environment.

One of the advantages of moving to Germignaga as a border worker is the possibility of enjoying a higher income than that earned in Italy. According to 2022 statistics, the average income of a frontier worker in Switzerland is about CHF 6,500 per month, while in Italy it is about € 2,500 (about CHF 2,700) per month.

However, it is important to also consider the disadvantages of this choice. One of the main ones is the difference in cost of living between Switzerland and Italy. According to the cost of living calculation, carried out by the Federal Office of the Territory (UFT) in 2022, the cost of living in Switzerland is about 50% higher than in Italy.

In addition, it is important to also consider the additional expenses that you may have as a border worker in Switzerland, such as the expenses for enrolling in health insurance and for enrolling in accident insurance on

Useful tools to protect your net income

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

Key points

If you are a frontier worker considering moving to Germignaga, it is important to inform yourself about the new rules and procedures to follow. The Frontaliere Ticino calculator can be a useful tool to calculate your taxes and better understand the new rules.

Concrete example: If you are a border worker working in Switzerland and have an income of CHF 80,000 per year, the Frontier Ticino calculator can help you calculate your taxes and understand how the new rules may affect your situation.

Switzerland has introduced new rules for border workers working in Switzerland who have a residence in Italy. As of 1 January 2022, frontier workers working in Switzerland and who have a residence in Italy are subject to a 20% tax on their income.

Concrete example : If you are a border worker working in Switzerland and have an income of CHF 80,000 per year, your tax could be CHF16,000 per year.

To move to Germignaga as a border worker, it is also important to consider the following issues:

• Residence: It is important to check if your residence in Italy is still valid and if it has not been changed due to your new employment situation in Switzerland. Work: It is important to check if your work in Switzerland is still valid and if it has not been changed due to your new work situation in Switzerland. Taxes: it is important to check how the new rules