Cross-border remote work: the 2026 compliance guide

Since January 1, 2026, the legal framework for teleworking for cross-border workers has become significantly stricter, particularly for employees residing in France and working in Switzerland. Specifically, new tax amendments are coming into force, and the application of European law regarding social security is being reinforced. 

These developments are transforming teleworking for cross-border workers into a major compliance issue for Swiss HR departments and business leaders. Indeed, with automated checks, exceeding the prescribed thresholds exposes you to costly consequences. So, what are the rules to follow regarding teleworking for cross-border employees to avoid a tax risk or a social security shift? 

This guide aims to provide an operational understanding of the rules applicable in 2026, the thresholds to monitor, and the consequences for the Swiss employer in the event of exceeding them. In addition, we offer concrete solutions to structure these practices and integrate telework monitoring into a talent management strategy.

Taxation and Social Security: The Two Pillars of Risk for Cross-Border Teleworking

Since the explosion of teleworking linked to the Covid-19 crisis, the setup of teleworking for cross-border workers has raised questions. If an employee in Switzerland teleworks from home in France, should they be taxed for their work in France? And at what volume of teleworking do they switch to French social security?

It is to clarify this that the legal framework has recently evolved, by setting clear thresholds beyond which the cross-border employee must pay taxes and switch to the social security system of their country of residence. However, it is absolutely essential to distinguish between the social security aspect and the tax aspect regarding this issue. 

Why Taxation and Social Security Must Be Handled Separately

A common mistake made by Swiss employers is to view teleworking for cross-border workers as a single topic. In reality, it relies on two completely distinct and independent legal frameworks: 

• The tax aspect, related to where the cross-border worker's salary is taxed;

• The social security aspect, related to social insurance, which determines which scheme the employee is affiliated with and to whom the Swiss employer must pay contributions.

These two pillars are governed by different texts, involve distinct thresholds, and answer to separate authorities. An employer may well find themselves below the tax threshold for teleworking but exceeding the social security threshold. 

Why a Mistake on Just One Pillar Is Enough to Create a Major Risk

European authorities have announced a reinforcement of controls related to cross-border teleworking starting in 2027. Specifically, European states will implement automatic data exchanges to better identify cross-border teleworking situations.

For Swiss companies, which are particularly affected by the use of cross-border employees, this implies significant financial and administrative risks. Indeed, poorly anticipated breaches of social and fiscal thresholds can lead to: 

• A reassessment of social security contributions, often retroactive;

• Increased complexity of withholding tax;

• A loss of visibility on employer costs, sometimes over several financial years.

For a Swiss mid-sized company, a mistake on a single cross-border employee can represent tens of thousands of francs, not to mention the administrative burden and the risk of subsequent audits.

The Social Pillar: The 25% Threshold to Never Lose Sight Of

The Basic European Rule in Social Security for Cross-Border Teleworking

The social security aspect is governed by EU Regulation 883/2004, applicable to Switzerland under its agreements with the European Union.

Here is the fundamental principle: if an employee performs more than 25% of their working time in their country of residence, they switch to the social security system of that country.

This threshold concerns all social security contributions: 

• Pension;

• Health insurance;

• Unemployment insurance;

• Associated social benefits

Regulated Tolerance via the A1 Form (Up to 49.9%)

Since the multilateral framework agreement based on Article 16 of EU Regulation 883/2004, a regulated exemption is possible.

A cross-border employee can remain affiliated with the Swiss OASI (AVS) up to 49.9% of teleworking, provided that: 

• The employer makes a formal request for an A1 form;

• The tracking is strictly documented.

France, Germany, Italy, Austria, and Switzerland are signatories to this agreement.

What Actually Goes into the Calculation of the Social Security Threshold

Here is the formula to calculate a cross-border employee's teleworking percentage:  

(Days worked outside of Switzerland ÷ total actual days worked) × 100

You must include: 

• Business trip or training days outside of Switzerland;

• Part-time work or compressed workweek situations.

The Tax Pillar: Teleworking Rules According to the Country of Residence

While the social security threshold applies uniformly to Switzerland and all its neighboring countries, the tax threshold varies from one country to another.

Tax Principles Applicable to Cross-Border Teleworking

On a tax level, teleworking is governed by bilateral agreements between Switzerland and neighboring countries. In principle, salary is taxed where the activity is performed. This means that if you work from France or Germany, it is subject to income tax in those countries.

However, teleworking directly challenges this principle. Indeed, where should an employee who teleworks for a Swiss company from another country be taxed? This is why there are teleworking tolerance thresholds that vary by country.

Teleworking for Cross-Border Workers: 2026 Comparative Table of Tax Thresholds by Country

France-Switzerland: The Tax Framework for Teleworking in 2026

Since January 1, 2026, the amendment to the 1966 Franco-Swiss tax treaty allows up to 40% teleworking from France while remaining taxed at source in Switzerland.

Beyond that: 

• The excess days become taxable in France;

• The employer must adjust the withholding tax: it is no longer calculated on the entire salary, but prorated based on the days worked in Switzerland and the taxable days in France. This implies an additional administrative burden;

• Traceability becomes mandatory: the employer must be able to prove the exact number of teleworked days, their location, and the calculation of the annual percentage.

Italy-Switzerland: The Tax Framework Applicable to Teleworking

For Swiss employees residing and teleworking in Italy, the tax threshold remains at 25% of working time. Beyond this, teleworked days are therefore taxed in Italy. 

Reference legal texts: 

• Switzerland–Italy Double Taxation Treaty

• Official declarations from the Swiss Federal Chancellery

Germany and Austria: No Dedicated Framework for Teleworking

For Germany and Austria, each day worked is taxable locally. No text provides for tolerance specifically for teleworking.

Reference legal texts: 

• Switzerland–Germany Tax Treaty (1971)

• Switzerland–Austria Tax Treaty (1974)

Exceeding Thresholds: What Are the Consequences for the Business?

It can happen that an employee exceeds the teleworking thresholds, which leads to administrative and financial consequences for both the employer and the employee concerned.

Social Security Reassessments and Scheme Switching

Exceeding the social security threshold in terms of teleworking for cross-border workers (25% or 49.9% with the A1 form) results in:

• Affiliation of the employee to the social security scheme of the country of residence;

• Contributions that are often higher than the Swiss OASI (AVS);

• Retroactive adjustments, interest, and penalties.

Tax Complexity and Organizational Risks

On the tax front, exceeding the prescribed threshold exposes the company to: 

• Double taxation;

• A posteriori payroll corrections;

• Reinforced audits and controls.

Starting in 2027, the automatic exchange of data makes these situations much easier to detect.

Securing Cross-Border Teleworking with an Adapted HRIS

Faced with this complexity, the right HR tools can greatly facilitate the tracking of cross-border teleworking. An HRIS designed for the Swiss context makes it possible to secure compliance with thresholds thanks to: 

• A rules and alerts engine to track working time by location and prevent threshold breaches;

• A single source of truth, with the centralization of teleworking amendments and A1 forms in the digital employee file;

• A native payroll connectivity, guaranteeing the consistency of withholding tax calculations via Abacus or ProConcept.

Roger natively integrates local specificities that many foreign software programs handle poorly, making it a key compliance lever for Swiss businesses. In addition, our tools integrate many modules such as the satisfaction survey.

Request a demo