Switzerland, with its impressive alpine landscape, world-renowned banks and high standard of living, has always attracted job seekers and professionals living in Germany.
Cross-border commuters from Germany are drawn across the border to Switzerland every day, whether it’s because of better salaries, attractive working conditions or simply the fascination of working in another country.
But despite all the opportunities and advantages, life as a cross-border commuter is not without its challenges. From tax regulations to social security and cultural differences, there are many aspects to consider.
We show you how to become a cross-border commuter in Switzerland, what you need to know about permits, taxes and insurance, and provide useful tips for everyday life.
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What is a cross-border commuter?
A cross-border commuter is a person who lives in one country and works in another. An important factor is the regular return to the place of residence.
The term refers to the proverbial crossing of a national border while commuting to work.
In this guide, we will deal with cross-border commuters living in Germany and working in Switzerland.
Let’s start with the difference between cross-border commuters and the often confused resident foreign nationals.
The difference between cross-border commuters and resident foreign nationals
Both cross-border commuters and resident foreign nationals work in a country without having their permanent residence there.
Both groups have different residence and work permits. Here are the main differences:
Cross-border commuters return to their place of residence on a regular basis, usually daily or at least once a week. To work in Switzerland, they need a cross-border commuter permit, often referred to as a “G permit”. This permit is usually limited to the job in the corresponding canton where the work is performed. Cross-border commuters pay income tax in Germany.
Resident foreign nationals, as well as short-term residents, who stay in Switzerland for a longer period of time. They need the L EU/EFTA permit (short stay, < 1 year) or the B EU/EFTA permit (1-5 years). Resident foreign nationals pay income tax in Switzerland.
|Resident foreign nationals
|Living in Germany
|Living in Switzerland
|B or L EU/EFTA permit
|Income tax in Germany
|Income tax in Switzerland
Advantages for cross-border commuters in Switzerland
Cross-border commuters benefit from several advantages when they work in Switzerland and live in Germany.
One of the most prominent advantages is the high Swiss salary. At the same time, they can enjoy the quality of life in Germany, which is characterized by familiar surroundings, cultural proximity and often a lower cost of living.
Cross-border commuter status thus combines the best of both worlds: An attractive salary in Switzerland and the lower cost of living in Germany.
The Swiss labor market is also characterized by stable employment conditions and a low unemployment rate. Working conditions in Switzerland are of high quality with respected employee rights.
Who can become a cross-border worker:in in Switzerland?
Persons with citizenship of an EU27/EFTA country are allowed to work as a cross-border commuter in Switzerland without any difficulties due to the free movement of persons.
The EU27 countries include: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.
The EFTA (European Free Trade Association) states are: Iceland, Liechtenstein, Norway and Switzerland.
Persons from newer EU member states such as Croatia or from non-EU or EFTA countries must expect difficulties and additional bureaucracy.
Permits for cross-border commuters in Switzerland
In order to work as a foreign person in Switzerland, a special permit is required.
The cross-border commuter permit is applied for by the respective employer at the responsible cantonal office.
There are different types of permits, depending on your place of residence.
Cross-border commuter permit (Permit G)
Persons who commute daily or at least weekly from Switzerland to their home country receive the cross-border commuter permit, also known as the G permit.
It is valid for an indefinite period of employment for up to 5 years and will be extended in case of continued employment. The employer applies for the permit before the new employee takes up employment.
Residence Permit (Permit B)
Persons who become gainfully employed and resident in Switzerland and are employed for a period of more than 12 months (unlimited) are issued a residence permit – permit B.
After the expiration of 5 years, the settlement permit C can be applied for, which brings, for example, tax advantages.
Short-term residence permit (permit L)
Persons who become gainfully employed and resident in Switzerland, and are employed for a maximum period of 12 months (limited), are granted the short stay permit – L permit.
In case of longer employment, the residence permit B is applied for afterwards.
The residence certificate – Ansässigkeitsbescheinigung – is a form issued by the German tax offices, which must be filled out and stamped at the German Wohnsitz-Finanzamt (tax office of residence), if possible, before taking up the job.
The form is used for tax coordination purposes. Thus, the employer, the German tax office and the cantonal tax office of the Swiss working canton receive one copy – the tax status of the cross-border commuter is thus clear.
Applications and job search for cross-border commuters in Switzerland
The job search in Switzerland is nowadays easily done via the Internet.
Numerous job portals offer a wide range of jobs, for example:
In many sectors, such as trades or industrial production, jobs are increasingly offered through personnel leasing or so-called temporary employment agencies.
The application process for cross-border commuters in Switzerland is not fundamentally different from the one in Germany. The scope, content and structure of your application documents remain identical.
Salaries for cross-border commuters in Switzerland
Salaries in Switzerland are often significantly higher than in Germany. For example, childless singles have earned the equivalent of 87,500 euros gross per year on average in recent years.
The reason for these higher wages is not only the strong economy and the high cost of living in Switzerland, but also the industries that are particularly well paid, such as the financial and pharmaceutical industries.
However, cross-border commuters should note that life in Switzerland is also more expensive. For example, the cost of rent, food and services can partially offset the higher salary if one decides to live in Switzerland.
Salary in Switzerland depends on many different factors and varies greatly between work location, industry, experience, etc.
Which bank account for cross-border commuters in Switzerland?
Cross-border commuters in Switzerland often need a Swiss bank account, firstly for salary payments, but also to be able to pay Swiss health insurance contributions as well as shopping, lunch or a Swiss mobile phone contract smoothly in CHF.
Some Swiss banks still welcome cross-border commuters as customers and offer comparatively favorable conditions.
German banks in the border area also have special solutions for cross-border commuters in Switzerland, whereby a direct debit from a Swiss health insurance company, for example, is only possible from an actual Swiss account as things stand today.
Insurance for cross-border commuters in Switzerland
One of the most important issues for cross-border commuters is the question of insurance. Especially for German cross-border commuters in Switzerland there are a lot of things to consider.
For cross-border commuters from Germany to Switzerland, there are three variants of cross-border health insurance available today.
If you were previously insured in Germany, you can usually continue your voluntary membership with the German statutory health insurance.
However, this is associated with high, income-dependent contributions and only makes sense in exceptional situations.
Alternatively, private health insurance is possible, the benefits of which can be selected very freely on the basis of the tariffs available on the market.
Private health insurance does not depend on income, but on the age of entry. In addition, the health condition is usually asked for in detail.
Co-insurance of family members can be expensive and a return to statutory health insurance is often no longer possible.
The most popular variant in recent years is the compulsory insurance in Switzerland according to the KVG, which is often also referred to as the statutory cross-border model or E106.
As a basic insurance, a Swiss health insurance company is chosen, through which you cover doctor and hospital treatments in Switzerland.
Via the supplementary form E106 / S1, you also receive free benefits from a statutory health insurance in Germany, the so-called benefits in kind assistance.
The easiest way is to then continue the previous German health insurance as an E106 cooperation fund.
Long-term care insurance
The long-term care insurance for cross-border commuters in Switzerland usually follows the health insurance: Those who have voluntary statutory or private health insurance usually have their long-term care insurance with the same insurance company.
There are special features for cross-border commuters in the KVG compulsory insurance (“E106” cross-border commuter model), since these persons receive a German insurance card, but have no entitlement to cash benefits in the event of long-term care.
This gap should definitely be covered by private supplementary care insurance, for example a daily care allowance via German private health insurance.
Our experts will advise you free of charge and without obligation on the subject of long-term care insurance for cross-border commuters.
Accident insurance is also mandatory for cross-border commuters in Switzerland. Accident insurance for cross-border commuters covers occupational illnesses and accidents. The Swiss Accident Insurance Fund is the responsible body.
The contributions for this are paid by the employer. If you work for the company for more than eight hours a week, you must also take out non-occupational accident insurance.
The costs for this are often deducted from the salary by the employer, but some companies also assume these costs completely.
Cross-border commuters in Switzerland pay unemployment insurance contributions. The contribution rate is 2.2% for wages up to CHF 146,000 per year. Employees and employers share the contributions at 1.1% each. Income amounts that exceed CHF 146,000 per year are not included in the calculation.
In the event of unemployment, cross-border commuters should contact their local RAV (Regional Employment Center) in Switzerland and obtain proof of their entitlements.
Cross-border commuters present these documents to the German employment agency and receive their unemployment benefits there.
Cross-border commuters who are insured under the compulsory KVG (cross-border commuter model E106) should take a closer look at the possibilities of supplementary insurance via German private health insurance companies.
The statutory cross-border commuter model has some gaps in benefits, such as a lack of cash benefits in the event of nursing care, low benefits for dental treatment/dental prostheses or only general ward in a Swiss hospital – these gaps can be closed individually and efficiently via private supplementary insurance in Germany.
Outpatient services such as preventive examinations, visual aids or treatment by non-medical practitioners can also be covered.
It is important that the supplementary insurance actually covers cross-border commuters with compulsory Swiss insurance in accordance with the KVG – this is not the case with many providers.
Our experts will advise you free of charge and without obligation on all relevant supplementary insurances for cross-border commuters.
Taxes for cross-border commuters
The taxation of German cross-border commuters working in Switzerland is regulated by bilateral agreements between Germany and Switzerland in order to avoid double taxation.
For classic cross-border commuters (daily return from the Swiss place of work to the German place of residence), the double taxation agreement exists.
In order to take advantage of the double taxation agreement, cross-border commuters must obtain a form from the tax office to record their tax situation, in which, for example, information on income, income-related expenses (e.g. travel expenses) or social security is provided.
Cross-border commuters then receive an extrapolation from the tax office and usually make quarterly advance payments to the German tax office.
In addition, as a cross-border commuter in Switzerland, you will receive the so-called certificate of residence in triplicate: one copy is for the tax office and is also passed on to the cantonal tax office in Switzerland; one is given to the employer so that the withholding tax can be deducted from the salary and one copy is given to the cross-border commuter for his or her records.
Swiss Withholding Tax – Quellensteuer
A limited withholding tax (Quellensteuer) of 4.5% is deducted from the gross salary of cross-border commuters in Switzerland. The prerequisite for this is that the certificate of residence has been issued to the employer.
The withholding tax paid is deducted from the income tax in Germany.
Income Tax Germany – Einkommensteuer
Cross-border commuters pay income tax (Einkommensteuer) in Germany. The tax rate depends on the amount of the total income and ranges from 14% to 45%.
The taxable income remains tax-free up to the amount of the basic tax-free allowance. The withholding tax already paid in Switzerland is deducted from the income tax.
Income tax return
Cross-border commuters are obliged to file an income tax return. The Swiss salary must be entered in the annex N-Gre.
Cross-border commuters can either complete and submit their tax return themselves or seek assistance from an income tax assistance association or tax consultants. There is also special software that makes it easier to fill out the tax return.
It is advisable to inform yourself annually about the various tax advantages and deductions for cross-border commuters and, if necessary, to seek professional assistance.
Important: The exchange rate between the Swiss franc and the euro has an impact on the tax burden for cross-border commuters, because cross-border commuters must declare their income in Swiss francs in their tax return.
The responsible tax office then converts the amounts into euros at the fixed exchange rate. If the Swiss franc appreciates in value, this can have a noticeable effect on your tax burden.
Grenzgängerdienst.de does not provide tax advice – but we work together with specialized tax advisors and will be happy to give you a recommendation.
Old-age provision and pension for cross-border commuters in Switzerland
The pension scheme for cross-border commuters in Switzerland is based on three pillars:
- Old-age and survivors’ insurance (AHV) and disability insurance (IV).
- The occupational pension plan (BVG, often also called pension fund)
- The private pension plan, often called “3rd pillar”.
The first two pillars are obligatory for most cross-border commuters in Switzerland; registration is done through the employer.
Old-age and survivors’ insurance (AHV) and disability insurance (IV)
Old-age and survivors’ insurance (AHV) and disability insurance (IV) are the cornerstones of social security in Switzerland. The AHV provides a monthly lifelong pension payment upon reaching retirement age or death, while the IV provides support in the event of incapacity due to disability.
The current retirement age for men and women in Switzerland is 65.
Occupational pension plan (BVG)
The BVG / pension fund is a funded system that supplements the state AHV/IV. Benefits can be paid either as a monthly, lifelong pension or as a one-time lump-sum payment.
Private pension provision (Pillar 3)
If you would like to make additional provisions, as a cross-border commuter you will receive a so-called 3rd pillar as a direct insurance / company pension plan, analogous to pillars 3 a & b in Switzerland.
The employer must become the contractual partner and policyholder. The cross-border commuter is solely responsible for contributions and benefits.
The contributions are fully tax deductible. The limit is 4 percent of the income threshold for statutory pension insurance (as of 2023: 3,504 euros).
You can choose between different variants (guaranteed interest, free fund selection, fund asset management), and low-cost group contracts further increase the attractiveness.
Rely on our years of experience in providing coverage for German cross-border commuters in Switzerland and book an appointment for our free, non-binding consultation!
Unemployment as a cross-border commuter
Cross-border commuters submit these documents to the German employment agency and receive their unemployment benefits there.
If German cross-border commuters working in Switzerland become unemployed, special regulations apply that result from the interaction of Swiss and German regulations as well as EU regulations:
1. unemployment benefit
As a cross-border commuter, you are generally entitled to unemployment benefits in your country of residence, i.e. Germany. The entitlement to and the amount of unemployment benefits are governed by the regulations in force in Germany.
It is important to register with the relevant employment agency in Germany immediately after termination or expiration of the employment contract.
2. contribution periods
Periods of work performed in Switzerland are taken into account when calculating entitlement to unemployment benefits in Germany.
In the event of unemployment, cross-border commuters should contact the RAV (Regional Employment Center) in Switzerland responsible for them and obtain proof of the entitlements acquired (currently form PD U1).
3. Swiss unemployment insurance
While employed in Switzerland, cross-border commuters pay contributions to the Swiss unemployment insurance scheme. In the event of unemployment, however, these contributions are normally reimbursed in Germany rather than in Switzerland.
4. insurance coverage
In case of unemployment, it is possible to return to statutory health insurance in Germany.
Working conditions for cross-border commuters in Switzerland
Working conditions in Switzerland are characterized by high standards, stable economic conditions and a performance-oriented work culture:
Regular working hours for office workers are usually 42 to 45 hours per week, while for industrial workers they can be up to 50 hours. Overtime is common and is usually either paid or compensated by time off.
By law, employees are entitled to at least four weeks of vacation per year, although many companies grant five weeks, especially for employees over the age of 50.
Switzerland does not have a general minimum wage law, but wages are generally high, reflecting the high standard of living and varying by industry and skill level.
Employees are covered by mandatory old-age and survivors’ insurance (AHV), disability insurance (IV) and occupational benefits (BVG or pension fund).
The Swiss work culture emphasizes punctuality, efficiency and personal responsibility. Consensus building is important in the business world.
These are generally shorter than in many other European countries, especially during the probationary period.
In summary, working conditions in Switzerland offer a combination of high standards, flexibility and a culture of responsibility and performance. The country has a strong focus on quality, innovation and advancement, which is reflected in working conditions.
Remote work for cross-border commuters in Switzerland
During the Corona pandemic, special regulations applied to cross-border commuters in Switzerland, which allowed them to work permanently from their home office in Germany without losing their status as cross-border commuters.
This exemption for teleworking for cross-border commuters was extended during the transition phase until June 30, 2023.
Since 01.07.2023, a new multilateral agreement is now in force: working remote / teleworking in the country of residence for cross-border commuters is now still possible, as long as it accounts for less than 50% of the total working time.
The responsibility for social insurance remains in the state of the employer.
Important: This new multilateral agreement only applies to persons who are also covered by the Agreement on the Free Movement of Persons with the EU or the EFTA Convention.
Furthermore, the following persons are excluded from the agreement:
- Persons who, in addition to teleworking, usually carry out other activities (e.g. regularly visiting clients, self-employed secondary employment) in the country of residence, even if that country has signed the multilateral agreement;
- Persons who, in addition to teleworking in the State of residence, habitually carry on an activity in another EU or EFTA State;
- Persons who, in addition to working for their Swiss employer, also work for an employer in the EU or in an EFTA state;
- Self-employed persons.
Special considerations for cross-border commuters with family
Cross-border commuters with a family or who wish to have children should be aware of some special features.
In Switzerland, for example, maternity leave is limited to 14 weeks, during which 80% of the salary (currently maximized to CHF 220 per day) is paid out.
Afterwards, the employment relationship is either continued directly, terminated or often unpaid leave is agreed with the employer.
If the employment relationship ends, it is usually advisable to apply for parental allowance in Germany (also possible for cross-border commuters in Switzerland or former cross-border commuters).
In the area of health insurance, cross-border commuters with families must bear in mind that non-employed relatives, i.e. spouses and children, must also be insured.
At this point, the choice of the health insurance model and the provider and tariffs is again decisive.
There are also special features with regard to child benefits.
If, for example, there is a sole earner in the family and this person is employed in Switzerland, the child allowance must be received in Switzerland (here called child allowance, paid by the employer).
If the other parent works in Germany subject to compulsory insurance, the child benefit can also be drawn via Germany instead.
Cost of living compared to Germany
Switzerland and Germany, although geographically neighboring, have significant differences in the cost of living. Switzerland is generally considered one of the most expensive countries in the world, while Germany has a wider range of living costs, depending on the region and city.
This is also relevant for cross-border commuters who rely on public transportation, want to buy lunch or spend time with their Swiss colleagues after work.
The cost of food and services in Switzerland is higher than the German average. This is reflected in many everyday products, whether in the supermarket or in a restaurant.
When it comes to transportation, the differences are less drastic. Although public transportation is more expensive in Switzerland, it is characterized by high reliability and quality. However, gasoline prices are often cheaper in Switzerland than in Germany.
The health care system in Switzerland is excellent, but health insurance premiums and general medical costs are considerably higher than in Germany. The education system in Switzerland, especially private educational institutions, can also be more expensive, although the public school system is of high quality.
Practical tips for everyday life as a cross-border commuter in Switzerland
As a German cross-border commuter in Switzerland, there are some practical tips that make everyday life easier and help to overcome unexpected challenges:
1. Plan your commute well
Take into account traffic jams at peak times and regularly check traffic or train connections. It may be useful to leave a little earlier or arrange more flexible working hours.
Switzerland uses the Swiss franc (CHF). It can be practical to always have some cash in CHF with you, even though many places accept euros. However, be aware that the exchange rate is often unfavorable in such cases.
3. Language differences
Even if you speak German, there are differences in Swiss German. Although many Swiss are willing to speak High German, it can be helpful to learn some Swiss terms or at least be prepared for their existence.
4. Health insurance
Find out exactly which health insurance options are best for cross-border commuters, especially with regard to medical treatment on both sides of the border.
5. Cultural differences
Even though Germany and Switzerland have many similarities, there are cultural differences in working methods, communication and social interaction. An open and respectful approach helps to integrate well.
Bonus: How cross-border commuters can save money
A decisive factor in saving money as a cross-border commuter is choosing the right health insurance model.
Often, a voluntary statutory insurance is hastily continued without taking into account the high, income-dependent contributions.
Likewise, private health insurance is often still chosen without taking into account the more expensive co-insurance of family members and the often expensive contribution situation in old age.
You can also save a lot of money on your bank account. Many Swiss banks charge cross-border commuters additional fees for their foreign domicile (residence and tax liability in Germany), which often amount to 30-40 CHF per month.
Other banks offer much more favorable solutions, sometimes less than 10 CHF per month.
With the “3rd pillar” direct insurance, cross-border commuters can also secure a massive tax saving and provide for their old age in a subsidized manner.