cross border workers switzerland guide tips

Cross-Border Workers in Switzerland: A Financial Guide

Do you live in France, Germany, Austria or Italy and work in Switzerland? Find the most important information for cross-border workers in this comprehensive guide.

If you are (or want to be) one of the nearly 317,000 cross-border workers who work in Switzerland but live in neighboring countries, you face some unique challenges. From opening a bank account to claiming tax deductions, everything is just a bit more complicated for G permit holders. Here, we answer the most important questions.

1. Health insurance

If you live in France, Germany, Austria or Italy, you can choose whether you want to be insured in your country of residence or in Switzerland. If you prefer to be insured in your country of residence, you have 3 months from the time you receive your G permit to submit an exemption request to the relevant cantonal office. If you live in France, your exemption request must be signed by the Caisse primaire d'assurance-maladie (CPAM) in France before being submitted. If you are not a citizen of an EFTA or EU country, you have the right (but not the obligation) to obtain compulsory Swiss health insurance within your first 3 months as a G permit holder. It is worth comparing the coverage provided by Swiss compulsory health insurance with that provided by your existing insurance before making your decision. If you are a citizen of an EFTA or EU country and live in a non-neighboring EFTA or EU member country, you have to get insured in Switzerland rather than your country of residence. The above rules apply not only to you, but to your unemployed dependents as well.

If you live in an EU or EFTA country and you get insured in Switzerland, you must obtain an E106 form from your Swiss health insurance provider and submit this to an insurance company in your country of residence. Once this has been completed, you can get medical treatment both in your country of residence and in Switzerland. When you get treatment in the country you live in, you must submit claims to your local health insurance provider (which gets reimbursed by your Swiss health insurance company). Claims for treatment in Switzerland can be submitted directly to your Swiss insurance company. In this way, you have an advantage over residents of Switzerland, who can only get treated outside Switzerland in the case of medical emergencies.

Although the coverage you get from compulsory Swiss health insurance is dictated by law, premiums vary broadly. Always make sure to compare compulsory health insurance premiums to find the best deal.

2. Health insurance premium reductions

If your household income is relatively low, you may be entitled to health insurance premium reductions. This is true even when your family does not live in Switzerland. Subsidies are paid out by the canton in which you are employed. In many cantons you have to actively claim premium reductions, and doing this promptly can save you a lot of money.

3. Bank accounts

Many Swiss employers expect you to have a bank account in Switzerland into which they can pay your salary but some Swiss banks do not accept non-residents as customers. The guide to Swiss bank accounts for cross-border workers explains which banks are favorable. Many Swiss banks open accounts for cross-border workers, but most charge extra non-resident fees which can come to hundreds of francs per year. There are banks which do not charge non-resident fees for residents of specific countries. You can download a comparison at the foot of the guide to non-resident fees. Another point to consider is currency exchange rates. Choosing a bank with favorable exchange rates can help you avoid losing too much money when changing your hard-earned francs into euros or other currencies. Peer-to-peer money transfer services and specialized currency brokers provide alternatives to banks for changing money. Transfer fees are also important to consider. You can use the interactive private account comparison to compare costs based on the number of international transfers you make. If you plan to hold savings in Switzerland, you can use the interactive savings account comparison to compare interest rates.

4. Accident insurance

If your sole workplace is in Switzerland, your employer has to take out occupational accident insurance which covers you in your workplace. If you work more than 8 hours per week, your employer automatically takes out non-occupational accident insurance which covers you outside your workplace from their accident insurance provider. As a cross-border worker, you can choose to receive treatment in Switzerland or in your country of residence. The benefits are explained in the guide to Swiss accident insurance.

5. Unemployment insurance

As a general rule, only residents of Switzerland are entitled to Swiss unemployment benefits. If you lose your job in Switzerland, you have to claim benefits from the unemployment office of your country of residence. You must obtain a PD U1 form from the Swiss unemployment office and an international employment certificate from your former Swiss employer. These must be completed and submitted to the employment office in your country along with salary slips or annual salary statements. The period over which you worked in Switzerland and contributed to Swiss unemployment insurance counts towards your unemployment benefits in your country of residence.

A possible downside is that you are subject to the limitations for unemployment benefits in your country of residence. That means the benefits you receive can be (much) lower than what you would receive if you could claim Swiss unemployment benefits. Exceptions are made for residents of EFTA and EU countries: You can claim Swiss unemployment benefits if you are only employed short-term, if you lose your job due to your employer going bankrupt, or if bad weather prevents you from working. The periods over which you have contributed to unemployment insurance schemes in EU or EFTA countries count towards your Swiss unemployment benefits.

6. Old Age and Survivors Insurance (OASI)

If you work in Switzerland, you have to participate in the OASI scheme. This is a basic social security pension. You become entitled to claim a pension from the OASI at retirement age once you have contributed for at least 12 months.

7. Pension fund

If your Swiss work contract is longer than 3 months and your salary is higher than  21,330 Swiss francs per year, your employer has to subscribe you to their occupational pension fund. What happens to your benefits if you stop being employed in Switzerland depends on which country you reside in. If you live in an EU or EFTA country, you can only withdraw your additional voluntary benefits (pillar 2b). The compulsory benefits (pillar 2a) must be transferred to a vested benefits account or a vested benefits fund or life insurance policy. If you live anywhere else, you can withdraw your benefits in full.

8. Pillar 3a

If you work in Switzerland and contribute to the OASI, you can use Swiss pillar 3a savings accounts or retirement funds to save for retirement. However, depending on your country of residence, there may be no tax benefit to using the pillar 3a. If you live in Germany, you cannot deduct pillar 3a contributions from your taxable income. If you live in Austria, you can claim pillar 3a deductions along with other tax deductions using the “application for re-assessment of the withholding tax” form provided by the Swiss tax office and get tax refunds.

9. Disability Insurance (DI)

In order to claim a disability pension, you have to work in Switzerland and participate in the DI scheme for at least 12 months out of the 3 years preceding your becoming disabled.

10. Maternity leave insurance (MSE)

As a cross-border worker, you are entitled to paid maternity leave as per Swiss maternity leave insurance benefits.

11. Child benefits

If you work in Switzerland, you are entitled to child benefits as long as your kids live in an EFTA or EU country. You get these via your Swiss employer along with your salary. However, if your spouse/partner works in your family’s country of residence, you must claim child benefits there and are not entitled to Swiss child benefits. If you receive child benefits in your country of residence and these are lower than Swiss child benefits, you can receive the difference from the Swiss family allowances scheme.

12. Loans

As a general rule, Swiss lenders do not give loans to non-residents. But there are lenders which make exceptions for cross-border workers. You can easily find loans for which you may be eligible by selecting “Permit G” under “Residence Permit” in the unbiased interactive personal loan comparison.

13. Buying property and mortgages

As a cross-border worker (G permit) you are allowed to buy a secondary residence in the near vicinity of your Swiss employer. You do not need to apply for a special permit for properties under 1000 m2. However, you are not allowed to rent out the property or to rent out rooms. As a general rule, Swiss banks do not accept mortgages from cross-border workers. Exceptions may be made if the property being mortgaged is in Switzerland. Some Swiss banks – particularly those in border regions – accept mortgages for properties outside of Switzerland which are near the Swiss border.

14. Taxes

As a cross-border worker, you normally pay Swiss taxes automatically, with your Swiss employer deducting tax at source from your salary. Switzerland has double-taxation agreements with a number of countries by which the withholding tax you pay in Switzerland is deducted from your tax liability in your country of residence. Typically, you need to provide your country’s tax office with your Swiss salary statements as these serve as proof of payment of Swiss withholding tax. If you live in Germany but spend more than 60 nights per year in Switzerland for work-related reasons, you are fully tax liable in Switzerland and are not tax liable in Germany. In many cases, that can be advantageous from a tax perspective. If you own property in Switzerland, it may be subject to property tax depending on the canton and municipality in which it is located.

15. Driving

If you want to use highways in Switzerland, you must pay the Swiss annual highway tax by purchasing a motorway sticker. You can get this at Swiss post offices and at most gas stations and supermarkets. You can also order it from motor clubs in many European countries. As a cross-border driver, you must pay careful attention to customs regulations for vehicles. You can use a private car registered in an EU country to commute to your Swiss employer, but you cannot use the car for work. If you stay in Switzerland during the work week and go home on weekends, you must obtain a permit for your car from the Swiss customs office. If you receive a company car registered in Switzerland from your Swiss employer, you can use the car to commute to work and back and for work, but private use other than commuting is forbidden by EU customs regulations. If you reside in an EU member country, never borrow cars registered in Switzerland and drive them to EU countries. Driving with a Swiss car in an EU country as an EU resident is strictly forbidden by EU customs regulations and can land you very hefty fines.

16. Telecom

Some mobile service providers (like Swisscom) make all of their mobile plans accessible to cross-border workers with G permits. Others (like Yallo) only let you get mobile plans if you are resident in Switzerland. All Swiss prepaid mobile offers are available to non-residents, and many prepaid offers deliver similar value-for-money to mobile plans. This is especially true when you add optional prepaid bundles which include call, data, SMS, international call and/or roaming allowances. You can compare Swiss prepaid offers by selecting "Prepaid offers" under "Plan or prepaid" in the interactive mobile plan comparison.

Important: If you also work in your country of residence and that work makes up 25% or more of your total workload or salary, you must remain insured by the social security schemes in your country of residence. This also applies to work for your Swiss employer which is done from home in your country of residence. You are not entitled to Swiss social insurances including accident insurance, Old Age and Survivors Insurance (OASI), Disability Insurance (DI), maternity leave insurance and (when applicable) unemployment insurance. You also are not entitled to participate in occupational pension funds or to use the pillar 3a for retirement saving.

More on this topic:
Bank accounts for cross-border workers explained
Tax at source for cross-border workers explained

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