Moving to Stelvio from border crossings: pros and cons

Context

TL;DR

• The new Cross-Border Commuters Agreement was signed on December 23, 2020 and comes into force on January 1, 2024.
• The G permit is tax-exempt for old cross-border commuters, while the transitional regime under Art. 9 of the Agreement applies only to those who meet the treaty definition and worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In all other cases, the ordinary regime applies, with Italian taxation and a credit for Swiss tax. The 10.000 euros under Art. 4 of Law 83/2023 are merely the limit for the income referred to in Art. 1, paragraph 175, Law 147/2013, not a general allowance. AFC fact sheet · Agreement, Art. 9 · Normattiva, Art. 4.
• Switzerland is not a member of the EU/EEA.

Moving to Stelvio as a cross-border commuter: pros and cons

Located on the border with Italy, the municipalities of Graubünden such as Stelvio, Bernina and Poschiavo have always been a bridge between Switzerland and Italy. The possibility of moving to these areas as a cross-border commuter is an attractive option for many workers. However, it is important to consider the pros and cons of this type of relocation.

Pros

• Ease of relocation: as a cross-border commuter, it is not necessary to have a visa to work in Switzerland or Italy.
• Access to better working conditions: cross-border commuters can access better working conditions and wages compared with citizens who are not cross-border commuters.
• Tax allowance: The transitional regime under Art. 9 of the Agreement applies only to those who meet the treaty definition and worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In all other cases, the ordinary regime applies, with Italian taxation and a credit for Swiss tax. The 10.000 euros under Art. 4 of Law 83/2023 are merely the limit for the income referred to in Art. 1, paragraph 175, Law 147/2013, not a general allowance. AFC fact sheet · Agreement, Art. 9 · Normattiva, Art. 4.

Cons

• Complex rules and regulations: the new Cross-Border Commuters Agreement has applied since January 1, 2024, and the rules and regulations are complex and may be difficult to understand.
• Residency requirements: cross-border commuters must reside in one of the areas designated by the neighboring state (in this case, Italy) for at least 183 days a year.
• Risk of rejection: cross-border commuters may be rejected if they do not comply with the rules and regulations.

Concrete examples

• Old cross-border commuter: an Italian citizen who has worked in Switzerland since 2010 as a cross-border commuter has an income of €80'000 per year and pays no taxes.
• The threshold of 10.000 euros under Art. 4 of Law 83/2023 concerns exclusively employment income earned abroad, in a border area or neighboring country, continuously and exclusively by persons resident in Italy, referred to in Art. 1, paragraph 175, of Law 147/2013; it is neither a general allowance nor an exemption from Swiss withholding tax. The regime under the new Agreement applies from January 1st, 2024.

Operational checklist

• Checking the rules and regulations: before moving, it is important to check the rules and regulations relating to the new Cross-Border Commuters Agreement.
• Residing in the designated area: cross-border commuters must reside in one of the areas designated by the neighboring state for at least 183 days a year.
• Complying with the rules and regulations: cross-border commuters must comply with the rules and regulations to avoid being rejected.

Comparisons between practical scenarios

• Cross-border commuter vs. citizen who is not a cross-border commuter: a cross-border commuter can access better working conditions and wages compared with a citizen who is not a cross-border commuter.

⚠️ Caution

• Complex rules and regulations: the new Cross-Border Commuters Agreement has applied since January 1, 2024, and the rules and regulations are complex and may be difficult to understand.
• Residency requirements: cross-border commuters must reside in one of the areas designated by the neighboring state for at least 183 days a year.

> Quote

"The new Cross-Border Commuters Agreement is an opportunity for workers to move to Switzerland or Italy and access better working conditions and wages." - Agenzia delle Dogane e dei Monopoli (2020)

💡 Suggestions

• Checking the rules and regulations: before moving, it is important to check the rules and regulations relating to the new Cross-Border Commuters Agreement.
• Residing in the designated area: cross-border commuters must reside in one of the areas designated by the neighboring state for at least 183 days a year.
• Complying with the rules and regulations: cross-border commuters must comply with the rules and regulations to avoid being rejected.

Operational details

Key facts

• What: The new Cross-Border Agreement
• When: December 23, 2020 (signed) and January 1, 2024 (in force)
• Where: Switzerland and Italy
• Who: Cross-border workers
• The threshold of 10,000 euros of the art. 4 of Law 83/2023 concerns exclusively income from employment carried out abroad, in a border area or in a neighboring country, continuously and exclusively, by people resident in Italy, referred to in the art. 1, paragraph 175, of Law 147/2013; it is not a general exemption nor an exemption from Swiss withholding tax.

Moving to Stelvio as a cross-border commuter: pros and cons

On 23 December 2020, the new Cross-Border Agreement between Switzerland and Italy was signed, which is applied from 1 January 2024. This agreement introduced new rules for cross-border workers, i.e. those who live in a region bordering another nation.

Moving to Stelvio as a cross-border commuter: pro

If you are a cross-border commuter looking for a new challenge, moving to Stelvio could be an interesting choice. Here are some pros:

• Simplification: The new agreement has simplified bureaucratic processes for cross-border workers, making transfers easier.
• Job opportunities: Stelvio is a region full of job opportunities, thanks to its strategic position between Switzerland and Italy.

Moving to Stelvio as a cross-border commuter: against

However, not everything is rosy. Here are some cons:

• Costs: Although there is an excess, you may have to pay costs for the transfer, such as the cost of registration and registration.
• Bureaucracy: Although the new agreement has simplified bureaucratic processes, you may still have to deal with complex bureaucracy.
• Adaptation: Stelvio is a region with a unique culture and environment, and you may have to adapt to a new reality.

Operational checklists

To move to Stelvio from a cross-border commuter, it is important to follow some operational checklists:

• Job search: Search for job opportunities in the region.
• Plan your move: Plan your move, taking costs and bureaucracies into consideration.
• Check the regulations: Check the regulations relating to the transfer of cross-border workers.

Concrete examples

Here are some concrete examples:

• Italian cross-border commuter: If you are an Italian cross-border commuter who wants to move to Stelvio, you may face a registration fee of €500 and a registration fee of €200.
• Swiss cross-border commuter: If you are a Swiss cross-border commuter who wants to move to Stelvio, you may face a registration fee of €300 and a registration fee of €150.

References to specific Ticino municipalities

Stelvio is a municipality in the canton of Graubünden in Switzerland, which borders Italy. Here are some references to specific Ticino municipalities:

• Stelvio: The municipality of Stelvio is an important commercial and cultural center for cross-border commuters.
• Bregaglia: The Bregaglia region is an important center of wood and metal production.
• Maloggia: The Maloggia region is an important center of food and drink production.

Regulations with dates and amounts

Here are some regulations relating to the transfer of cross-border workers:

• Cross-border workers agreement: The cross-border workers agreement was signed on 23 December 2020 and is applied from 1 January 2024.
• Registration costs: Registration costs vary from €300 to €500.
• Registration costs: Registration costs vary from €150 to €200.

Comparisons between practical scenarios

Here are some comparisons between practical scenarios:

• Italian cross-border workers vs. Swiss cross-border worker: An Italian cross-border worker may have to face higher registration and registration costs than a Swiss cross-border worker.
• Stelvio vs. Bregaglia: Stelvio is a larger and more populous municipality than Bregaglia, and could offer more job and development opportunities.

Conclusions

Moving to Stelvio from a cross-border commuter can be an interesting choice, but it is important to consider the pros and cons. It is important to plan the transfer, check the deductible and check the regulations relating to the transfer of cross-border workers.

Useful tools for your case

To conveniently check your scenario within/beyond 20 km, use the net salary calculator and tax return guide.

Key points

Moving to Stelvio as a frontier worker: pros and cons

The new Frontier Workers Agreement provides for new rules for frontier workers. The G permit is tax-exempt for old frontier workers, while the transitional regime under Art. 9 of the Agreement applies only to those who meet the definition under the Agreement and have worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with taxation in Italy and a credit for Swiss tax. The 10.000 euro under Art. 4 of Law 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, of Law 147/2013, not a general tax allowance. AFC factsheet · Agreement, Art. 9 · Normattiva, Art. 4. Switzerland is not a member of the EU/EEA. It is important to note that the new Frontier Workers Agreement is not yet in force, and therefore it is not yet possible to move to Stelvio under the new regulations.

Who are frontier workers?

Frontier workers are people who reside in Switzerland and have an employment or study arrangement in Italy. They are subject to specific tax and employment rules, which may vary depending on their status as frontier workers. Frontier workers can be divided into two categories: old frontier workers and new frontier workers.

Old frontier workers:

Old frontier workers are those who have already obtained the G permit before January 1, 2023. These frontier workers are exempt from taxes on income derived from their work in Italy. For example, if an Italian frontier worker works as an accountant for a Swiss company based in Bellinzona and earns an income of €80'000, they will not be subject to taxes in Switzerland.

The transitional regime under Art. 9 of the Agreement applies only to those who meet the definition under the Agreement and have worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with taxation in Italy and a credit for Swiss tax. The 10.000 euro under Art. 4 of Law 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, of Law 147/2013, not a general tax allowance. AFC factsheet · Agreement, Art. 9 · Normattiva, Art. 4. For example, if an Italian frontier worker works as an engineer for a Swiss company based in Lugano and earns an income of €120'000, they will be subject to taxes in Switzerland only on income above €10'000.

How does the new Frontier Workers Agreement work?

The new Frontier Workers Agreement was signed on March 10, 2022 and will enter into force on January 1, 2024. This agreement provides for new rules for frontier workers, which can be summarized as follows:

• Old frontier workers: exempt from taxes on income derived from their work in Italy
• The transitional regime under Art. 9 of the Agreement applies only to those who meet the definition under the Agreement and have worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with taxation in Italy and a credit for Swiss tax. The 10.000 euro under Art. 4 of Law 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, of Law 147/2013, not a general tax allowance. AFC factsheet · Agreement, Art. 9 · Normattiva, Art. 4.
• Switzerland is not a member of the EU/EEA

Operation Checklist:

To move to Stelvio as a frontier worker, it is necessary to follow these simple steps:

1. Check your status as a frontier worker (old or new) 2. Check whether your income is subject to taxes in Switzerland 3. Check whether it is necessary to pay taxes in Switzerland 4. Check whether it is necessary to file a tax return in Switzerland

Example of moving to Stelvio:

Suppose that an Italian frontier worker obtained the G permit on January 15, 2023 and works as an accountant for a Swiss company based in Bellinzona. This frontier worker has an income of €80'000 and is not subject to taxes in Switzerland. However, if they decide to move to Stelvio, they will have to file a tax return in Switzerland and may be subject to taxes in Switzerland if their income exceeds €10'000.

Comparison of practical scenarios:

• Old frontier worker: exempt from taxes on income derived from their work in Italy
• The transitional regime under Art. 9 of the Agreement applies only to those who meet the definition under the Agreement and have worked in Graubünden, Ticino or Valais between December 31, 2018 and July 17, 2023; the covered employment income is taxed exclusively in Switzerland. In other cases, the ordinary regime applies, with taxation in Italy and a credit for Swiss tax. The 10.000 euro under Art. 4 of Law 83/2023 is merely the limit for the income referred to in Art. 1, paragraph 175, of Law 147/2013, not a general tax allowance. AFC factsheet · Agreement, Art. 9 · Normattiva, Art. 4.
• Frontier worker with income above €10'000: subject to taxes in Switzerland

Switzerland is not a member of the EU/EEA, so frontier workers are not subject to tax and employment rules similar to those of the EU. However, the new Frontier Workers Agreement provides for new rules for frontier workers, which may vary depending on their status as frontier workers. It is important to note that the new Frontier Workers Agreement is not yet in force, and therefore it is not yet possible to move to Stelvio under the new regulations.