moving to Madesimo as a border worker: pros and cons (cross-border guide)

Context

In a nutshell

• Tax at source on income from work: ONLY withheld in Switzerland for border workers.
• New Frontier Agreement: signed on 23/12/2020, effective from 1 JANUARY 2024.

Moving to Madesimo from a border crossing: pros and cons

If you are a border worker working in Switzerland and wish to move to Madesimo, in the heart of the Alps, you need to consider the pros and cons of this decision. Switzerland is a country with a complex tax system, and border crossers are subject to specific rules.

Tax at source on earned income

Switzerland applies a source tax on labour income, which is calculated on gross salary. However, if you are a frontier worker, the tax is withheld only in Switzerland, while in Italy no tax is withheld.

New Frontier Agreement

On 23 December 2020, the New Frontier Agreement was signed, which comes into force from 1 January 2024. This agreement provides for new rules for frontier workers, including the possibility of withholding tax in Switzerland also for Italian workers.

Pros and cons of transferring to Madesimo

• Pro:
• Easy access to health and social services in Switzerland.
• Possibility of working in Switzerland with a higher salary.
• Access to a wider network of services and professional opportunities.
• Possibility to enjoy a better life in a unique natural environment.
• Cons:
• Possibility of being subject to a higher tax in

Operational details

Key facts

• Tax at source on income from work: ONLY withheld in Switzerland for border workers.
• New Frontier Agreement: signed on 23/12/2020, effective from 1 JANUARY 2024.
• Exchange rate: 1 CHF = 0.90 EUR (as of 01/08/2023).
• Negotiations for a new agreement between Switzerland and Italy: ongoing.

Moving to Madesimo from a border crossing: pros and cons

Madesimo, a municipality of 1,120 inhabitants located in the upper Valtellina valley, is an enchanting place to live and work for border workers. But what does it mean to move to Madesimo as a border worker and what are the advantages and disadvantages of this choice?

Benefits

• Low taxation: as a border worker, you can benefit from the low taxation on income from work in Switzerland, which can reach 70% compared to Italian taxation.
• Low-cost housing: Buying a home in Madesimo can be more affordable than in other areas of Switzerland.
• Access to services: Madesimo has a school, an outpatient clinic and other essential services for the community.
• Connection with Italy: the municipality of Madesimo is easily accessible from Italy, thanks to the presence of state road 36 and the Malpensa-Tirano railway line.

I against

• Residence limits: as a border crossing, you may be subject to residence limits in Switzerland, which may vary depending on the type of residence permit.
• Residence permit negotiations: the process of

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Key points

Practical analysis

• Tax at source on income from work: ONLY withheld in Switzerland for border workers.
• New Frontier Agreement: signed on 23/12/2020, effective from 1 JANUARY 2024.

Moving to Madesimo from border crossing: pros and cons

Madesimo, an Italian municipality located in the province of Sondrio, is a great choice for those who want to work in Italy and enjoy life in the Alps. However, for frontier workers, the fiscal impact and the consequences on their economic situation must be considered. Here are some pros and cons to consider:

Pro

• Work flexibility : Madesimo offers many job opportunities, especially in sectors such as agriculture, hotels and commerce.
• Cost of living: The cost of living in Madesimo is lower than in many other locations in northern Italy.
• Quality of life: the country offers a beautiful outdoor life, with many opportunities for sports and nature.

Against

• Tax at source: frontier workers have to pay income tax at source only in Switzerland, but this does not mean that they do not have to pay taxes in Italy.
• New Frontier Agreement: From 1 January 2024, the new Frontier Agreement will be in force, which could lead to significant changes for frontier workers.
• Operational checklist: for border workers who wish to move to Madesimo, it is important to check the following things:

+ Check the validity of the residence permit. +

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