New AVS reform 2024: changes for cross-border workers

Di Valerie Linc ·

As of January 1st, 2024, new AVS rules come into force. Here's what's new for those working in Switzerland and living in Italy

Contesto

In brief - New AVS reform from 1 January 2024 - Changes for cross-border workers - New contribution rates - Impact on income and pensions - Practical examples and operational checklist ## Key facts - What: New AVS reform - When: From 1 January 2024 - Where: Canton Ticino and Switzerland - Who: Cross-border workers and Swiss employees - Amount: New contribution rates The new AVS reform comes into effect from 1 January 2024, introducing significant changes for cross-border workers who work in Switzerland and reside in Italy. The new provisions mainly concern the contribution rates and the calculation methods of AVS contributions. For cross-border workers, it is crucial to understand how these changes may affect their income and pension contributions. ### Contribution rates The new AVS contribution rates have been revised to ensure greater fairness and sustainability of the pension system. Cross-border workers will need to adapt to the new rates, which may result in an increase or decrease in contributions depending on the income bracket. It is important to check your specific situation to avoid surprises. For example, a cross-border worker residing in Varese with an annual income of 60,000 CHF will see an increase in the AVS contribution from 10.2% to 10.5% of the salary. This means an annual increase of 300 CHF, which will be withheld directly from the salary. For those earning 80,000 CHF, the increase will be 400 CHF annually. ### Impact on cross-border workers The AVS reform will have a significant impact on cross-border workers, particularly those working in Canton Ticino. The new rules may affect the calculation of pension contributions and, consequently, the net income received. It is advisable to consult a tax expert to better understand the practical implicat...

Dettagli operativi

Practical Analysis The new AVS reform, which came into force on January 1, 2024, introduces several novelties that Ticino cross-border workers need to know to adapt to the new provisions. It is essential to understand how the new contribution rates affect your income and pension contributions. ### Comparison with the previous situation Before the reform, AVS contribution rates were calculated differently. For example, a cross-border worker living in Mendrisio with a monthly income of 5,000 CHF paid 10.2% of their income for AVS, with a monthly contribution of 510 CHF. With the new reform, the rates have been revised to ensure greater equity and sustainability of the pension system. This could result in an increase or decrease in contributions depending on the income bracket. ### Concrete Scenarios Suppose a cross-border worker earns 6,000 CHF per month. With the new contribution rates, the AVS contribution could increase or decrease depending on the income bracket. For example, if the cross-border worker lives in Lugano and falls into the income bracket between 5,000 and 8,000 CHF, the AVS contribution could increase from 10.2% to 11.4%, bringing the monthly contribution from 612 CHF to 684 CHF. Conversely, if the cross-border worker lives in Chiasso and falls into the income bracket between 3,000 and 5,000 CHF, the AVS contribution could decrease from 10.2% to 9.8%, bringing the monthly contribution from 510 CHF to 490 CHF. ### Procedure to Adapt To adapt to the new AVS reform, cross-border workers must follow some fundamental steps: 1. Check your income bracket - Consult the table of new AVS contribution rates published on the AVC (Old-Age and Survivors' Insurance) website. - Identify the income bracket you fall into. 2. Calculate the new AVS contributions...

Punti chiave

Concrete action The new AVS reform, which came into force on January 1, 2024, requires cross-border workers to act promptly to adapt to the new provisions. It is essential to follow a clear and precise procedure to avoid errors and surprises, especially considering that the new AVS contribution rates range from 9.6% to 10.7% of gross income, depending on the income bracket. ### Steps to follow 1. Verify income bracket: Use the salary calculator to determine your income bracket. For example, a cross-border worker residing in Mendrisio with an annual gross income of CHF 80,000 falls into the medium income bracket, with an AVS contribution rate of 10.2%. 2. Calculate AVS contributions: Check the new contribution rates and calculate the pension contributions. For an income of CHF 80,000, the AVS contribution will be CHF 8,160 annually (10.2% of CHF 80,000). It is important to note that the maximum contribution for 2024 is set at CHF 25,650 for cross-border workers. 3. Adjust net income: Adjust your net income based on the new rates. With a gross income of CHF 80,000 and a contribution rate of 10.2%, the net income will be CHF 71,840 (CHF 80,000 - CHF 8,160). 4. Consult a tax expert: Consult a tax expert for further details and assistance. For example, a tax consultant in Lugano can help optimize your tax return and better understand the tax implications of the new AVS reform. ### Useful tools To facilitate the process, you can use various tools available on the site: - Salary calculator: To simulate the impact of the new rates on your income. For example, a cross-border worker from Chiasso with a gross income of CHF 60,000 will see an AVS contribution of CHF 5,880 (9.8% of CHF 60,000). - Tax guide: To better understand the new tax provisions. The guide includes detaile...

Punti chiave

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Frequently Asked Questions
What are the new AVS contribution rates?
The new AVS contribution rates have been revised to ensure greater equity and sustainability of the pension system. The specific rates depend on the income bracket and can be verified using the salary calculator.
How does the AVS reform affect the net income of cross-border workers?
The AVS reform can affect the net income of cross-border workers depending on the income bracket. It is important to check your specific situation to avoid surprises and adjust your net income based on the new contribution rates.
What steps should cross-border workers take to adapt to the new AVS reform?
Cross-border workers must follow a clear and precise procedure to adapt to the new AVS reform. The steps include verifying the income bracket, calculating the AVS contributions, adjusting the net income, and consulting a tax expert.

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