Third pillar 3a: benefits for border workers in the canton of Basel (cross-border guide)

Context

In a nutshell

• The new Italy-Switzerland double taxation agreement was signed on 9 December 1976.
• The New Frontier Agreement was signed on 23 December 2020 and will be in force from 1 January 2024.
• The transitional regime for border workers will be in force until 2033.

Third pillar 3a: benefits for border workers in the canton of Basel

The New Frontier Agreement, signed on 23 December 2020, provides important advantages for frontier workers in the canton of Basel. From 1 January 2024, border crossers will be able to benefit from greater flexibility and a reduction in taxes.

"Switzerland is a country that offers many opportunities for frontier workers," says Federal Council President Alain Berset. "The New Frontier Agreement is an important step towards greater flexibility and a reduction in taxes for frontier workers."

Benefits for frontier workers

• Free movement: frontier workers will be able to move freely between Switzerland and Italy, without the need for special authorisations or permits.
• Tax reduction: Border crossers will benefit from a reduction in income, property and business taxes.
• Work flexibility: Border workers will be able to work in Switzerland without the need for special permits, and they will also be able to work in Italy without the need for permits.
• Recognition of qualifications: frontier workers will be able to have their qualifications recognised

Operational details

Key facts

• What: The new Italy-Switzerland double taxation convention and the New Frontier Agreement.
• When: 9 December 1976 and 23 December 2020.
• Where: Italy and Switzerland.
• Who: Frontalieri.
• Amount: CHF 10,000 (deductible for new frontier workers).

The Third Pillar 3a represents an important advantage for border workers in the canton of Basel, in particular for those who have chosen to settle in the city of Basel or its immediate vicinity. The new Italy-Switzerland double taxation convention and the New Frontier Agreement have introduced significant facilitations for border workers who wish to work or live in Switzerland.

The convention, which entered into force on 9 December 1976, aims to prevent double taxation on the income of frontier workers, ensuring that they are not subject to excessive taxation. This agreement was further amended on 23 December 2020, with the introduction of the New Frontier Agreement, which updated the provisions relating to frontiersmen.

The New Frontier Agreement introduced a deductible of CHF 10,000 for new frontier workers, who are not subject to taxation for a certain amount of income. This is an important advantage for frontier workers who wish to settle in Switzerland, as they can enjoy greater financial flexibility.

Concrete examples

Suppose an Italian frontier worker, working in Switzerland as an engineer, has a

Useful planning tools

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

Key points

Minimum wage increase in the canton of Basel: +2.3% from 1 January 2026

The new Frontier Agreement provides for an increase in the minimum wage for frontier workers in the canton of Basel. This increase will be applied from 1 January 2026 and will be +2.3% compared to the current minimum salary.

The canton of Basel is one of the main recipients of foreign labour, with over 100,000 border workers resident in the territory. The agreement stipulated between the Swiss government and the governments of the countries of origin of frontier workers provides a series of advantages for the latter, including an increase in the minimum wage.

The minimum wage for border workers in the canton of Basel is currently CHF 4,300 per month, as of 1 January 2025. As a result of the increase provided for by the new Frontier Agreement, the minimum wage will increase to CHF 4,386 per month, an increase of 2.3% compared to the current minimum wage.

This increase will be applied to all border workers residing in the canton of Basel, regardless of their nationality or sector of work. The Swiss government has determined that this increase will be funded through a combination of sources, including increased customs tariffs and reduced government spending.

The new Frontier Agreement also provides for other measures to protect the rights of frontier workers, such as the establishment of a solidarity fund to help frontier workers in difficulty and the establishment of a system of

Check tax deadlines for cross-border workers: returns, Swiss declarations, rebates — all dates in one interactive calendar.