Grenzgänger in Switzerland: what changes with the 2024 tax agreement (cross-border guide)
From 1 January 2024, new tax rules for border workers between Italy and Switzerland, with increased deductibles and new taxation procedures.
Contesto
In short - The signing of the new Frontier Agreement took place on 23/12/2020. - It entered into force on 1 January 2024. - Switzerland is not an EU/EEA member. ## Key facts - What: New tax agreement between Italy and Switzerland - When: Signed on 23 December 2020, in force from 1 January 2024 - Where: Switzerland and Italy - Who: Swiss and Italian Government - Amount: Border deductible increased from 7,500 to 10,000 euros From 1 January 2024, new tax rules concern border workers between Italy and Switzerland, in particular with regard to the taxation of labour income. The signing of the new Frontier Agreement, which took place on 23 December 2020, led to important changes, in force since the first day of 2024. Switzerland, which is not a member of the EU or the European Economic Area, continues to maintain its tax regime, but with some news for border crossers. The new agreement provides for a higher tax exemption than in the past: border workers already in business before 17 July 2023 benefit from an exemption of 7,500 euros, with a transitional regime that will last until 2033. The new frontier workers, on the other hand, will have a deductible of 10,000 euros. The withholding tax on income from work will be exclusively in Switzerland, thus avoiding double taxation. Italy, through the tax credit, will ensure that border workers do not pay twice on the same income. In addition, the convention against double taxation signed
Dettagli operativi
Practical analysis The introduction of the new tax rules from 2024 represents a substantial change for border workers between Italy and Switzerland, with implications that go beyond the simple deductible. The most significant change concerns the possibility of taking advantage of a higher deductible: 10,000 euros for new border crossers and 7,500 euros for those already in business before July 17, 2023. This difference translates into concrete tax savings, especially for those with annual incomes between 20,000 and 50,000 euros. Before the agreement, border taxation provided for a withholding tax in Switzerland with lower deductibles and more complex procedures. Now, the withholding takes place exclusively in Switzerland, avoiding double taxation and simplifying administrative procedures. Switzerland applies the withholding tax rate at source, while in Italy the worker can request the tax credit in the annual return. The regulatory framework is strengthened by the convention signed in 1976, which continues to regulate tax relations between the two countries, but with significant updates to the deductibles and the mode of taxation. For workers, the new regime also means greater transparency and simplicity in calculating taxes. The possibility of taking advantage of a tax credit in Italy makes it possible to avoid double payment, ensuring that taxation is fair and complies with international regulations. The impact of ## Useful tools to protect your net income To reduce FX leakage, compare CHF-EUR exchange options and banks for cross-border workers.
Punti chiave
Step-by-step procedure and tools To optimize border taxation, follow these steps: 1. Check the start date of activity: if before 17 July 2023, the transitional regime with an exemption of 7,500 euros applies. If later, the deductible is 10,000 euros. 2. Contact the relevant Swiss cantonal tax office to update your tax situation and request withholding only in Switzerland. 3. Submit the necessary documents: attestation of annual income, any documentation of residence. 4. Claim the tax treatment with the new deductible and withhold it at source. 5. In Italy, enter the Swiss tax credit on your tax return to avoid double taxation. To make this easier, you can use online tools like the tax calculator, which provides accurate estimates based on income and personal situation. ### How to use the calculator - Enter your annual income. - Select the activity start date. - Check the applicable deductible. - Get a tax savings estimate. In addition, it is advisable to consult a tax consultant specialised in border management to optimise taxation as much as possible. ### To recap - Update your details with the Swiss tax office. - Request withholding in Switzerland only. - Use the online calculator to check your savings. - Insert in the declaration
Punti chiave
[{"q":"What is the effective date of the new tax agreement?","a":"The agreement entered into force on 1 January 2024, after being signed on 23 December 2020."},{"q":"What are the current deductibles for frontier workers?","a":"For frontier workers already in business before 17 July 2023, the deductible is 7,500 euros with a transitional regime until 2033. For new frontier workers, the deductible is 10,000 euros."},{"q":"How do you avoid double taxation?","a":"In Italy, the tax credit is required on the tax return, while in Switzerland withholding tax is applied. This combination avoids double taxation."},{"q":"What tools can I use to calculate tax savings?","a":"You can use the tax calculator available on the official website, entering income and business start date."}]
Frequently Asked Questions
- What is the effective date of the new tax agreement?
- The agreement entered into force on 1 January 2024, after being signed on 23 December 2020.
- What are the current deductibles for frontier workers?
- For frontier workers already in business before 17 July 2023, the deductible is 7,500 euros with a transitional regime until 2033. For new frontier workers, the deductible is 10,000 euros.
- How do you avoid double taxation?
- In Italy, the tax credit is required on the tax return, while in Switzerland withholding tax is applied. This combination avoids double taxation.
- What tools can I use to calculate tax savings?
- You can use the tax calculator available on the official website, entering income and business start date.