The agreement of 23 December 2020

Ratification and entry into force

The Agreement between the Swiss Confederation and the Italian Republic on the taxation of cross-border workers was signed on 23 December 2020 together with a protocol amending the double taxation convention of 1976.¹ Italy ratified both instruments by Law No. 83 of 13 June 2023, published in the Gazzetta Ufficiale No. 151 of 30 June 2023, after the Senate had approved the bill in April 2023, the Chamber of Deputies had amended it on 4 May 2023 and the Senate had given final approval on 31 May 2023.² The agreement entered into force on 17 July 2023 and applies from 1 January 2024. The agreement of 1974 continued to apply until 31 December 2023.³

The new agreement replaces the principle of exclusive taxation at the place of work by a system of concurrent taxation. The State of employment may tax the remuneration of a cross-border worker, but only up to 80 per cent of the tax that would normally apply. The State of residence taxes the same income under its domestic rules and gives a credit for the tax paid in the State of employment.⁴ The agreement is reciprocal. It applies equally to Swiss residents working in the Italian border area, although their number is small. The financial compensation to the Italian border municipalities is abolished for the new regime and maintained, at 40 per cent of the tax levied on the "old" crossborder workers, only until the end of the fiscal year 2033.⁵

Who is a cross-border worker under the agreement

The agreement defines the cross-border worker in Art. 2 by four cumulative conditions. The person must be resident for tax purposes in a municipality whose territory lies wholly or partly within twenty kilometres of the border with the other State. The person must be employed in the border area of the other State by an employer resident there or by a permanent establishment or fixed base situated there. The person must in principle return daily to the main residence in the State of residence. The border areas are, for Switzerland, the cantons of Graubünden, Ticino and Valais and, for Italy, the Regions of Lombardy, Piedmont and Aosta Valley and the Autonomous Province of Bolzano.⁶ The lists of the qualifying municipalities are annexed to the agreement and to the related exchanges of notes. They are wider than the lists used under the 1974 regime, which created the special problem of the "new municipalities" discussed below.

The requirement of a daily return is relaxed for professional reasons. A cross-border worker who does not return to the residence for professional reasons on up to 45 days in a calendar year keeps the status. Days of holiday and sickness do not count against this limit.⁷ A worker who exceeds the limit, who lives outside the twenty-kilometre band or who works outside the border cantons is not a cross-border worker under the agreement. Such a person is taxed in Switzerland at source under the ordinary rules, without the 80 per cent limit, and in Italy as an Italian resident with a credit for the Swiss tax under the double taxation convention.

Notes

1. Vorpe (above); Camera dei deputati, Servizio Studi, "Accordo con la Svizzera relativo all'imposizione dei lavoratori frontalieri", https://temi.camera.it/leg19/provvedimento/accordo-con-la-svizzera-relativo-all-imposizione-dei-lavoratori-frontalieri.html (signature in Rome on 23 December 2020). ↩
2. Camera dei deputati, Servizio Studi, "Accordo con la Svizzera relativo all'imposizione dei lavoratori frontalieri", dossier of 30 June 2023, https://temi.camera.it/leg19/provvedimento/accordo-con-la-svizzera-relativo-all-imposizione-dei-lavoratori-frontalieri.html. ↩
3. Foglio informativo e FAQ (above). ↩
4. Ibid.; Camera dei deputati, dossier (above). ↩
5. Foglio informativo e FAQ (above); Vorpe (above). ↩
6. Foglio informativo e FAQ (above). ↩
7. "Frontalieri Italia–Svizzera: ratificate nuove regole su rientri e telelavoro", Edotto, 20 January 2026, https://edotto.com/articolo/frontalieri-italiasvizzera-ratificate-nuove-regole-su-rientri-e-telelavoro. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.