Exchange of salary data with Italy, the applicable law arrives (cross-border guide)
New legislation for the exchange of salary information between Switzerland and Italy
Contesto
In brief - Switzerland and Italy signed the New Frontier Agreement on 23 December 2020. - The agreement entered into force on 1 January 2024. - The new legislation provides for the exchange of salary data between the two countries to improve the fiscal and social security management of border workers, such as for the approximately 70,000 border workers working in the Canton of Ticino. ## Key facts - What: New Border Agreement between Switzerland and Italy. - When: Signed on 23 December 2020, effective from 1 January 2024. - Where: Switzerland and Italy, with particular impact on border cantons such as Ticino, Graubünden and Valais. - Who: Governments of Switzerland and Italy. - Amount: Not specified, but it is estimated that the exchange of salary data could concern about 300,000 border workers. On 23 December 2020, Switzerland and Italy signed the New Frontier Agreement, which entered into force on 1 January 2024. This agreement provides for the exchange of salary data between the two countries to improve the fiscal and social security management of border workers. For example, employers in the Canton of Ticino will have to communicate the wage data of border workers to the Italian tax authorities, which in turn will provide information on the income received in Italy by border workers working in Switzerland. The implementing law provides for the exchange of data to take place annually by 30 September, as specified in the order of the Federal Department of Finance of 15 November 2023. > "The
Dettagli operativi
Practical implications The new legislation will have significant implications for border workers working in Switzerland and residing in Italy. The exchange of salary data will allow a more efficient management of taxes and social security contributions. For example, a border worker who works in Geneva and resides in Como will see the tax reporting procedure simplified thanks to the automatic sharing of salary data between the two countries. This will reduce the risk of errors or omissions that could result in penalties or refunds not due. ### Comparison with the previous situation Before the entry into force of the New Frontier Agreement, the exchange of information between Switzerland and Italy was limited. Now, with the new legislation coming into force on 1 January 2023, wage data will be regularly shared between the two countries, reducing the chances of errors or omissions in border workers' tax returns. Swiss cantons such as Ticino, which has a significant presence of border crossers, will be directly involved in the management of this data exchange. > "The new regulation represents an important step towards greater transparency and cooperation between Switzerland and Italy." Border workers will be able to verify the data shared through the official channels provided by the tax authorities of the respective countries. ## Useful tools to protect your net income To reduce FX leakage, compare CHF-EUR exchange options and banks for cross-border workers.
Punti chiave
Procedure for frontier workers Frontier workers must be aware of the new rules for the declaration of income and social security contributions introduced by the applicable law on the exchange of wage data with Italy. It is advisable to consult a professional to ensure that you are in compliance with the new regulations. For example, a border worker who works in Lugano and resides in Como will have to declare their income according to the new rules, which could affect social security contributions. ### Useful tools Use our salary calculator to check how the new rules might affect your financial situation. For example, if a border worker earns CHF 60,000 per year and resides in Italy, they may have to pay social security contributions of around CHF5,000 more per year depending on the new rules. Calcolatore stipendio > "The new implementing law represents an important step to ensure transparency and correct application of tax and social security regulations for border workers" - Federal Office of Social Insurance. An operational checklist for frontier workers could include: - Check the new rules for tax reporting - Calculate social security contributions according to the new regulations - Consult a professional to ensure that you are in compliance. Cantons such as Ticino, with a strong presence of border workers, will be particularly interested in these new
Punti chiave
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Frequently Asked Questions
- What does the New Frontier Agreement provide for?
- The New Frontier Agreement provides for the exchange of salary data between Switzerland and Italy to improve the fiscal and social security management of frontier workers.
- When did the New Frontier Agreement come into force?
- The New Frontier Agreement entered into force on 1 January 2024.
- How can I check the impact of the new rules on my financial situation?
- You can use our salary calculator to check how the new rules might affect your financial situation.