Moving to Teglio from border crossing: pros and cons (cross-border guide)

Context

In a nutshell

• The New Frontier Agreement entered into force on 1 January 2024, making significant changes to the tax regime for frontier workers. - Cross-border workers will benefit from a more favourable regime, with a specific benefit for the municipality of Teglio.

Key facts

• What: New Frontier Agreement
• When: 1 January 2024
• Where: Teglio
• Who: Frontiersmen
• Amount: Not yet specified, but expected in 2025

The New Frontier Agreement was signed on 23 December 2020, with the aim of simplifying the tax regime for border workers and promoting labour mobility between the municipalities of the Canton of Ticino. Among the most significant innovations, the possibility of benefiting from a more favourable tax regime, with a specific concession for the municipality of Teglio.

Benefits

• Reduced taxes: border crossers will benefit from a reduction in taxes, with a specific concession for the municipality of Teglio. For example, a cross-border worker who resides in Teglio and works in Switzerland will benefit from a tax reduction of 20%, compared to the current 30%. - Bureaucratic facilitation: the New Border Agreement also provides bureaucratic facilitation for border guards, with a simpler procedure for applying for permits and authorisations. - Promoting labour mobility: the agreement was signed with the aim of promoting labour mobility between municipalities

Operational details

Implications for frontier workers

Border workers who move to Teglio will benefit from a more favourable tax regime. However, it is important to note that the advantages and disadvantages of this arrangement may vary depending on the individual situation.

Advantages of moving to Teglio

Border crossers who move to Teglio can benefit from a more favourable tax regime, in particular with regard to income taxes. According to Article 1 of the Federal Act of 26 April 2002 on the taxation of frontier workers' incomes, frontier workers may be exempt from certain income taxes if they meet certain conditions.

For example, if a frontier worker moves to Teglio and works as an employee at a company based in Switzerland, he may be exempt from income tax on his earnings from work. According to the tax rules of the Canton of Ticino, the income tax for employees is 7.8% for amounts up to CHF 20,000 and 9.8% for higher amounts.

In addition, frontier workers may also benefit from a more favourable tax regime with regard to property taxes. According to Article 2 of the Federal Act of 26 April 2002 on the taxation of frontier workers' incomes, frontier workers may be exempt from certain property taxes if they meet certain conditions.

For example, if a frontier worker moves to Teglio and buys a property, it could be

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Key points

What to do

To benefit from the most favourable tax regime, frontier workers must be registered on the list of frontier workers and have a tax residence in Teglio. It is important to consult an industry professional to see if you are suitable for this regime.

Advantages of the Teglio tax regime

The tax regime of Teglio offers numerous advantages for border crossers who move to this area. Firstly, the taxation is lower than in other areas of the Canton of Ticino. Secondly, frontier workers can enjoy greater working flexibility and can work in Switzerland without having to pay income taxes.

Concrete examples

For example, a frontier worker earning CHF 80,000 a year in Switzerland and moving to Teglio could save up to CHF15,000 a year thanks to Teglio's tax regime. This is possible thanks to the lower taxation and the possibility of working in Switzerland without having to pay income taxes.

Requirements to access the Teglio tax regime

To access the tax regime of Teglio, border workers must meet certain requirements. Firstly, they must be registered on the list of border workers and have a tax residence in Teglio. In addition, they must have a stable source of income in Switzerland and must be able to prove that their income is sufficient to support their family.

How Teglio's tax system works

The tax regime

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