On July 19, 2023, SIF announced that the new cross-border commuter agreement with Italy and an amending protocol to the DTA entered into force on July 17, 2023. The provisions are applicable as of January 1, 2024.
Switzerland now taxes 80% of the income of cross-border commuters working in Switzerland. The new cross-border commuters will also be taxed in Italy, avoiding double taxation.
New" cross-border commuters are persons who enter the labor market as of July 17, 2023. A transitional arrangement applies to cross-border commuters who worked in the cantons of GR, TI or VS between December 31, 2018 and July 17, 2023. They will continue to be taxed exclusively in Switzerland, with Switzerland having to pay the Italian border municipalities financial compensation amounting to 40% of the withholding tax levied in Switzerland until the end of 2033.
For more information, please also refer to our article dated January 9, 2021.