What is the difference between the €10,000 deductible for new frontier workers and the €7,500 exemption for old ones in 2026?

From 1 January 2024, the New Frontier Agreement differentiates the regimes: border workers who became such after 17 July 2023 (new) have a flat-rate exemption of €10,000, while old people (already border workers before that date) benefit from an exemption of €7,500 until 2033. The deductible represents the minimum non-taxable income in Italy; above that, ordinary personal income tax rates apply (23% up to €28,000, 33% up to €50,000, 43% over €50,000). In 2026, these limits remain active under the transitional regime.

How is the 730 CE tax credit calculated if I have children?

In the EC framework of the Italian Form 730, enter the total amount of withholding tax withheld from Switzerland (in CHF, converted to EUR). The Revenue Agency recognizes this credit up to the deductible due (€10,000 or €7,500 depending on your status). Above the deductible, apply the IRPEF rates. For children, state in the “Dependents” or “Universal Unique Allowances” section their tax code and date of birth; the Agency automatically applies deductions if the total income of the family falls within the limits.

Does Italy apply double taxation on labour income in Switzerland?

No. The bilateral Italy-Switzerland Convention of 9 March 1976 avoids double taxation. Switzerland withholds the tax at source (5.3% AVS/AI/IPG for employees, plus LAINF and cantonal contributions); Italy recognises the tax credit in the EC framework of the declaration, applying its personal income tax rates only on income that exceeds the deductible. The New Frontier Agreement (effective 1 January 2024) standardised this mechanism with differentiated deductibles.

What documents are needed to complete the EC framework in 2026?

Collect: (1) tax certification at source from the employer or the canton of Ticino; (2) December pay slips; (3) tax codes and dates of birth of children declared dependent; (4) any INPS receipts for contributions paid in duplicate. Convert the amounts in CHF to EUR according to the year-end exchange rate. Consult your CAF or accountant for a full review of documents specific to your situation.

Does the G Permit allow me to take advantage of the deductible in 2026?

Yes. The G Permit (Border Work Authorization) is the foundation of border status. With Permit G active, you are eligible for the New Deal deductibles (€10,000 if you became a frontier worker after 17/7/2023, €7,500 if earlier). Verify that your G Permit is renewed and valid at the time of the 2026 declaration.

2026 tax credit: calculation for family with children

Di Marco Ferrari · Published on 30 August 2026 · Updated on 25 September 2026

Frontalier family with children reviewing tax documents at Ticino-Italy border checkpoint

Frontier workers with children: CE framework of 730, deductible €10,000 new and €7,500 old. Calculation of tax credit, withholding tax withheld in Switzerland, return deadlines 2026.

Context

In brief

Box CE of 730: tax credit from Swiss withholdings CHF
2026 exemption: €10,000 new cross-border workers, €7,500 old until 2033
New Agreement effective January 1, 2024, avoids double taxation

Key facts

What: Tax credit for recovery of source tax withheld only in Switzerland
When: 2026 tax return (year 2025); Agreement effective 1/1/2024
Where: Box CE, Italian 730 form at the Revenue Agency
Who: Cross-border workers with Permit G (dependent work in Ticino/Switzerland)
Amount: €10,000 exemption for new, €7,500 exemption for old (transitional 2024-2033)
Source tax: Withheld ONLY in Switzerland (5.3% AVS/AI/IPG employee)
Bilateral convention: March 9, 1976 Italy-Switzerland (avoids double taxation)

In 2026, cross-border workers with children working in Ticino will continue to benefit from the tax credit for source taxes withheld in Switzerland. The system works as follows: Switzerland withholds income tax on work income according to its rates (AVS/AI/IPG 5.3% for employees, plus any insurance contributions LAINF 0.7–1.5% and cantonal); Italy, applying the bilateral convention of March 9, 1976 and the New Cross-border Agreement effective January 1, 2024, recognizes the tax credit in the 730 form, box CE, thus avoiding double taxation. The Italian return accounts for differentiated exemptions: €10,000 for cross-border workers who became such after July 17, 2023 (new), €7,500 for old cross-border workers with transitional regime until 2033.

The practical consequence is that, within the limits of the exemption, the amount paid in Switzerland is deducted from the Italian taxable income, reducing overall tax pressure. For families with children, the advantage increases thanks to family allowances and deductions for family dependents, which Italy recognizes in the return. Using the salary and tax calculator, you can simulate the impact of the exemption on your net income.

How the New Agreement changed the framework

The New Cross-border Agreement, signed December 23, 2020 and effective January 1, 2024 (ratified in Italy with Law 83 of June 13, 2023), introduced a clear differentiation between old and new cross-border workers. The old ones (already such before July 17, 2023) benefit from a €7,500 exemption in transitional regime until 2033; the new ones have a permanent €10,000 flat exemption. This means that the first euro of income beyond the exemption is subject to ordinary Italian tax according to IRPEF rates (23% up to €28,000, 33% up to €50,000, 43% above €50,000). Before January 2024, the mechanism was less defined; the Agreement has standardized and clarified the procedure, facilitating tax planning for families.

Operational details

In concrete terms, how does the calculation of the tax credit for a border family with children in 2026 work?

Scenario: border crossing with two children

A border worker with two children, employed in Ticino with annual gross income, suffers Swiss withholdings from Switzerland (5.3% for AVS/AI/IPG employee, plus any LAINF 0.7–1.5% and administrative/cantonal contributions). The Swiss net amount is reduced by about 6-8% due to these withholdings. At the time of the Italian declaration, the taxpayer enters the total amount of withholdings in the EC framework and, thanks to the deductible of €7,500 (if old border) or €10,000 (if new), recovers the tax credit on part of the taxable amount.

In this way, the taxpayer does not suffer double taxation: Switzerland withholds a percentage, Italy recognizes the credit and applies its personal income tax rates only on income that exceeds the deductible. For a family with two children, the additional deductions (universal one-off checks, historically dependant deductions) further reduce the Italian net tax. Coordination with INPS ensures that family allowances are recognised as long as the total income of the family remains within the established limits.

Difference Between Old Regime and New Agreement

Before 1 January 2024, frontier workers were treated with less transparency about deductibles. The New Agreement has standardized the mechanism: a clear line between

Key points

Step-by-step procedure: completing section CE in form 730

1. Collect documents: receive from the Swiss employer (or from the competent canton through the municipal tax administration) the certification of source taxes withheld during the year. Also keep December payslips or cantonal tax certificates, as well as any receipts for contributions paid to INPS for pension contributions paid in duplicate. 2. Enter data in section CE: in the Italian 730 form, section "Foreign employment income", enter the gross amount earned in Switzerland (in CHF) and the total amount of source tax withheld, converted to EUR at the exchange rate of the fiscal year-end date. 3. Declare children: in the section "Dependent family members" or "Universal family allowances", list the children with their data (tax ID, date of birth, any personal income). The Revenue Agency will automatically apply deductions if the family income falls within the regulatory limits. 4. Verify the threshold: make sure you have clearly noted whether you are an old cross-border worker (exemption €7,500) or new (threshold €10,000). This determines which portion of income is taxable in Italy and which remains covered by the Swiss tax credit. 5. File the 730: submit the return through a CAF (Tax Assistance Center), a tax advisor, or online on the Revenue Agency portal by the ordinary deadline.

Deadlines and timelines

The deadlines for filing the 730 return follow the standard Italian calendar (generally May-June for the paper form, July for the electronic version). It is advisable to complete the compilation by the ordinary deadline to avoid penalties and quickly receive the tax credit.

Checklist for cross-border families with children

☐ Collect source tax certificates from Switzerland (amounts in CHF)
☐ Verify whether you are old cross-border workers (before 17/7/2023) or new (from 17/7/2023 onwards)
☐ Convert CHF amounts to EUR (ECB exchange rate at year-end)
☐ Enter gross amounts and withholdings in section CE of form 730
☐ List children and dependent family members with tax ID, date of birth, personal income
☐ Verify that deductions for children and dependent family members are applied
☐ Check that the tax credit covers at least the applicable threshold (€7,500 or €10,000)

Available tools for simulation and further information

Use the cross-border payroll and tax calculator to simulate the impact of the threshold, Swiss withholdings (AVS/AI/IPG, LAINF, LPP) and family deductions on your net income. For specific questions about LAMal (health insurance), AVS/AI/LPP pension contributions and coordination with INPS, consult a tax advisor or your local CAF.

Plan your 2026 return with the cross-border tax calculator: enter your Swiss gross salary, number of children and family situation, and get an estimate of the tax credit owed. For details on the filing procedure and management of section CE of form 730, we recommend consulting a tax advisor experienced in cross-border matters or the CAF in your canton.

Frequently Asked Questions

What is the difference between the €10,000 deductible for new frontier workers and the €7,500 exemption for old ones in 2026?: From 1 January 2024, the New Frontier Agreement differentiates the regimes: border workers who became such after 17 July 2023 (new) have a flat-rate exemption of €10,000, while old people (already border workers before that date) benefit from an exemption of €7,500 until 2033. The deductible represents the minimum non-taxable income in Italy; above that, ordinary personal income tax rates apply (23% up to €28,000, 33% up to €50,000, 43% over €50,000). In 2026, these limits remain active under the transitional regime.
How is the 730 CE tax credit calculated if I have children?: In the EC framework of the Italian Form 730, enter the total amount of withholding tax withheld from Switzerland (in CHF, converted to EUR). The Revenue Agency recognizes this credit up to the deductible due (€10,000 or €7,500 depending on your status). Above the deductible, apply the IRPEF rates. For children, state in the “Dependents” or “Universal Unique Allowances” section their tax code and date of birth; the Agency automatically applies deductions if the total income of the family falls within the limits.
Does Italy apply double taxation on labour income in Switzerland?: No. The bilateral Italy-Switzerland Convention of 9 March 1976 avoids double taxation. Switzerland withholds the tax at source (5.3% AVS/AI/IPG for employees, plus LAINF and cantonal contributions); Italy recognises the tax credit in the EC framework of the declaration, applying its personal income tax rates only on income that exceeds the deductible. The New Frontier Agreement (effective 1 January 2024) standardised this mechanism with differentiated deductibles.
What documents are needed to complete the EC framework in 2026?: Collect: (1) tax certification at source from the employer or the canton of Ticino; (2) December pay slips; (3) tax codes and dates of birth of children declared dependent; (4) any INPS receipts for contributions paid in duplicate. Convert the amounts in CHF to EUR according to the year-end exchange rate. Consult your CAF or accountant for a full review of documents specific to your situation.
Does the G Permit allow me to take advantage of the deductible in 2026?: Yes. The G Permit (Border Work Authorization) is the foundation of border status. With Permit G active, you are eligible for the New Deal deductibles (€10,000 if you became a frontier worker after 17/7/2023, €7,500 if earlier). Verify that your G Permit is renewed and valid at the time of the 2026 declaration.