Solbiate Olona-Ticino: living as a frontier worker in 2024 (cross-border guide)

Context

In a nutshell

• New Frontier Agreement in force from 1 January 2024: withholding tax withheld only in Switzerland
• Frontier category G: AVS 5.3%, LPP 7–18% by age, LAMal with deductibles CHF 300–2500
• Double taxation avoided: Italy grants tax credit in the EC framework of 730
• Old border guards: exemption €7,500 until 2033; new: deductible €10,000

Key facts

• What: New Italy-Switzerland Border Agreement
• When: Effective from 1 January 2024 (Law 83/2023)
• Where: Ticino, Brogeda, Chiasso, Gaggiolo, Ponte Tresa
• Who: Employee border guards category G
• Tax: Withheld only in Switzerland by the employer
• AVS contribution: 5.3% mandatory of the employee
• Income exemptions: €10,000 (new), €7,500 (old, transitional 2024–2033)

The choice to live in Solbiate Olona and work as a frontier worker in Ticino represents a consolidated economic opportunity, but entails radically changed tax and social security obligations from 1 January 2024 with the entry into force of the New Frontier Agreement. This agreement, signed on 23 December 2020 and ratified in Italy with Law 83 of 13 June 2023, modifies the structure of taxation and social contributions for those who cross the Brogeda, Chiasso, Gaggiolo or Ponte Tresa crossings daily.

Unlike the previous legislation, the tax at source is now withheld exclusively in Switzerland by the employer: there are no longer any parallel withholdings

Operational details

Compulsory social security: AVS, LPP and ancillary contributions

Those who work in Switzerland as border workers are required to pay AVS/AI/IPG contributions (old-age, disability, maternity insurance) at a fixed rate of 5.3% of the gross salary, borne by the employee. Alongside this, the Swiss system provides for an AD (unemployment insurance) and AC (loss of earnings allowance) contribution of 1.1% each, with a maximum cap of CHF 148'200 of annual salary. Finally, there is the LAINF (accident insurance), paid almost entirely by the employer, while the employee contributes between 0.7% and 1.5%. The total amount has a significant impact on the paycheck.

The real distinguishing element is the LPP (Legal Pension Plan), the second mandatory pillar from the age of 25. The border worker pays a contribution ranging from 7% to 18% of the gross salary, based on age. At the age of 25, the contribution is lower; with advancing age it grows progressively. It is not optional. This means that a border crossing with CHF 4,500 per month will have to pay at least CHF 315 of LPP only, in addition to the CHF 239 of AVS. The Swiss paycheck is much more 'taxed' from a social security point of view than an Italian paycheck, but the result is a considerably more generous Swiss pension income than the Italian INPS.

LAMal: health insurance and the choice of frontier

A frequently confusing aspect

Useful planning tools

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

Key points

Checklist practice: your first 90 days

If you are planning to move to Solbiate Olona and start working in Ticino, follow these steps in order to avoid administrative errors.

Before departure: 1. Sign the Swiss employment contract; notify the Italian residence to the employer. 2. Request the employer to apply the frontier worker regime from the start date. 3. Check if you are a 'old frontier worker' (qualification before 17/7/2023) or 'new' — it affects the fiscal franchises.

First week of work: 1. Register with the Italian anagrafe of Solbiate Olona (if not already resident). 2. Notify the INPS (National Institute of Social Security) of your situation as a Swiss employee resident in Italy. 3. Choose LAMal Swiss or INPS Italian permanence; communicate the choice within the required terms. 4. Obtain from the employer the CAIS registration number, if applicable in the canton.

First month: 1. Check the payslip: it must show the CHF withholding tax, AVS 5.3%, LPP (by age range), AD/AC, LAINF. 2. Keep all pay stubs and annual certificates of withholding. 3. Register with the Ticino cantonal administration of contributions (AFC/ESTV for federal aspects).

Annual declaration preparation

Every year, in autumn, the frontier worker must prepare the Italian declaration to recover the tax credit. Follow these steps: collect the annual withholding certificate from the Swiss employer (usually sent by the end of February of the following year); prepare the Italian declaration (model 730 or Redditi models); insert the Swiss income in the CE table; claim the tax credit for the Swiss withholding taxes already paid; send through CAF, accountant or online platform by October 31. This procedure ensures the recovery of double taxation.

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