At the end of July, France ratified the amendment to the FR/CH double taxation agreement concerning telework for cross-border workers. This amendment will apply from January 1, 2026.
In essence, the agreement confirms the current arrangements. Telework performed in France for up to 40% of working time (including 10 days of temporary assignments) will continue to be taxed in Switzerland. In return, Switzerland will provide additional financial compensation to France. The agreement also stipulates that the two countries will automatically exchange salary data of affected individuals starting next year.
Swiss employers will therefore be required to report to the Swiss Federal Tax Administration (AFC) the telework rate granted to each employee residing in France. Employers must provide this data at the beginning of year N for the fiscal year N-1. The first transmission between the authorities is thus expected to take place in early 2027 for the 2026 fiscal year.
It is worth noting that the agreement does not affect the concept of a permanent establishment, which may be created if a company carries out significant business activities in a State other than the one where it is headquartered. This remains governed by the usual rules of international law.
Nor does it alter the applicable rules on social security, under which a cross-border worker becomes subject to the French system if they perform 50% or more of their work via telework on French soil.
