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The rules Swiss cross-border shoppers in France and Italy should know

If you live in Swiss regions of Geneva, Vaud, Jura, Neuchâtel or Ticino you probably shop in France or Italy more or less regularly. Here are the rules you should know about.

Published: 11 January 2022 13:46 CET
Updated: 26 January 2022 12:34 CET

These groceries are much cheaper across the border. Photo by Maria Lin Kim on Unsplash

Due to lower prices and greater variety, Swiss residents have been shopping in border regions of France for decades.

But if you think shopping in France got more complicated during the pandemic, consider this: “It’s not easy to go shopping in France, when you live in Geneva. At each passage through customs, there are checks. In the other direction too, there are many hassles, since the French francs are no longer accepted in Geneva stores”.

Confused? Don’t be — this is just a blast from the past, specifically from May 31st, 1968, about cross-border shopping on RTS public broadcasting.

The video included in this report shows that while cross-border shopping was as popular half a century ago as it is now, the process was much more complex and involved, for instance, a border guard asking drivers to open their wallets.

The situation is much simpler in January 2022. According to French Embassy in Switzerland, people living within a radius of 30km from the French border and travelling to France for less than 24 hours, are exempted from the obligation to show proof of vaccination or a negative test result required from ‘regular’ tourists.

However, once you are in France and want to get a bite to eat or a drink, you must show your Covid certificate (‘pass sanitaire’) to enter, the same way you would in Switzerland. Swiss certificate is accepted across the border, and vice-versa.

Please note that all the rules outlined in this article pertain to people who permanently reside in Switzerland, regardless of their nationality.

So if you have a UK (or any other) passport but live in Switzerland, these regulations apply to you.

Swiss customs rules

When bringing goods into Switzerland, whether from France or another border country, you will need to pay VAT if the amount exceeds 300 francs.

While border checks are rare, those who make a habit of exceeding this amount – even if it is for goods for personal use – run the risk of falling foul of the authorities.

There are several different rules in place for bringing in different items, including meats, cheeses and alcohol.

The limits for each of these items can be found here.

Keep in mind that while the 300-franc limit applies now, Switzerland looks set to reduce this to 50 francs in the future – although final approval of this is pending.

What about French customs?

Swiss residents are entitled to tax free shopping in France, as Switzerland is a non-EU country.

The rules state you must be at least 16 years of age and be visiting France for a period of less than six months.

French Customs is not responsible for reimbursing the VAT paid on purchases made in France. Only the retailer from whom you purchased the goods can do so, according to the French Customs site.

To qualify, the total amount of your purchases, inclusive of all taxes, must be greater than €100. They must have been bought in the same shop and on the same day. At the time of purchase, the retailer will give you a VAT refund form, which must be signed by both the retailer and you.

More information about how to claim your refund can be found here.

What about shopping in Italy?

Ticino residents are used to hop across the border for money-saving shopping sprees, but they will have to wait until at least January 31st to resume this activity.

That’s because since December 16th and until the end of this month, anyone crossing the border into Italy must meet certain requirements, according to the Federal Department of Foreign Affairs.

Complete the Digital Passenger Locator Form
Present a Digital COVID Certificate or other equivalent certification which attests the full vaccination or full recovery from coronavirus in the past six months
Present a PCR test (carried out within 48 hours) or antigenic swab test (carried out within 24 hours) prior to entry into Italy, with negative test result.

Obviously, these conditions, with no exemption for border residents, don’t make it worthwhile to cross into Italy with the mere purpose of shopping.

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EXPLAINED: How to save on your mortgage in Switzerland

As the only country in Europe where more than 50 percent of people rent their home, Switzerland has the lowest home ownership rate on the continent.

This is due to a variety of factors, including strong tenancy laws, culture, cost and a scarcity of land.

There are some however who are keen to buy their own home – and evidence suggests this number is growing.

While having enough cash is an important starting point, there are also a range of other factors to be taken into consideration.

Here are some tips for mortgages in Switzerland.

Give yourself time – more time than you think you need

Buying a home will be one of the most important and consequential decisions you ever make, so give yourself plenty of time beforehand.

Speak to other people who have bought homes recently and several years ago.

Get to know the relevant terminology for your part of Switzerland so that you know what you are talking about.

For instance, what was a LIBOR mortgage – and what is a SARON mortgage – and how has the latter replaced the former?

A low interest rate is great, but can you pay the mortgage off early. If not, you may end up costing yourself a whole lot more.

Is the interest rate fixed or variable? And if it is variable, what happens when rates rise?

Below are just some general tips to consider, but remember that you can never investigate too much.

Check out the following link for more specifics on the costs of buying a home in Switzerland.

EXPLAINED: The hidden costs of buying a home in Switzerland

Is taking out a mortgage to buy a home in Switzerland a good decision?

Interest rate rises haven’t quelled rising demand for properties, nor has the impact of the pandemic.

Speaking with Swiss news organisation Tamedia, property expert Patrick Schnorf said demand is set to continue.

“We assume that due to immigration, high birth rates and household divisions, demand will remain the same in the near future,” Schnorf said.

“People have saved a lot (during the Covid pandemic), many have a secure income, these are the driving factors,”

In fact, the Covid pandemic has not dampened demand, but has channeled it towards a different type of property.

Larger properties with more rooms and gardens have seen greater demand as a consequence of lockdowns and working from home requirements

“The radius of the real estate search has therefore also extended to the surrounding rural regions,” explained Schnorf.

While lockdowns look to be over and the working from home rules have come to an end, experts argue that some of these changes are more than mere trends and are likely to be permanent.

What types of mortgages are there in Switzerland?

There is a relatively wide array of mortgages on offer in Switzerland, but here are some of the main ones.

Not unique to Switzerland is the fixed-rate mortgage, where you pay an agreed rate on your mortgage over a set period of time. This is the case regardless of interest rate trends.

Also not unique to Switzerland is the variable mortgage, where rates are subject to market fluctuations.

Comparatively unique to Switzerland is the SARON (Swiss Average Rate Overnight) mortgage.

The SARON mortgage replaced the LIBOR mortgage (London Interbank Offered Rate) at the start of 2022.

The interest rates for SARON mortgages are variable and are calculated on the basis of the SARON reference rate.

The SARON reference rate takes into account actual transactions in the Swiss money market (unlike the LIBOR rate which was calculated on the basis of recommendations from a handful of banks) and is therefore believed to be more transparent.

Know and understand Swiss deposit rules

Before you even begin thinking about buying a home, you need to know that higher deposits are required in Switzerland than many other countries.

The minimum deposit in Switzerland is around a fifth (20 percent) of the total purchase cost.

This is much higher than the five percent often seen in English-speaking countries, but it’s much lower than the 40 percent sometimes required in Germany.

While you might have just felt your home ownership dreams disappear with a whoosh, only half of that 20 percent figure should come in cash.

The other half can come out of equity.

It can also come out of your pension fund – although if you’ve only recently arrived in Switzerland, you might not have that much cash stashed in there.

Switzerland has low interest rates – but be aware of fluctuations

Swiss interest rates have been low for years, creating an ideal situation for anyone wanting to borrow money to get onto the property ladder.

But just because something has been a certain way for a while doesn’t mean it will stay that way – and even a quarter of a percent increase in interest rates can have significant impacts on the average mortgage.

Inflation has already hit highs in Switzerland – and more appears to be on the way.

In January 2022, several financial institutions announced that mortgage rates were on the rise due to a likely rate increase from Switzerland’s National Bank.

That said, interest rate hikes are not necessarily permanent – but be sure to incorporate scope for rate fluctuations into your budget.

Don’t just stick to banks

It might sound counter intuitive, but avoiding banks might help you save on a mortgage.

Insurers often have competitive rates for mortgages that beat out what the banks have to offer.

Generally speaking insurance companies offer fixed term mortgages and interest rates are lower than those offered by the banks, although you may need to commit to a longer term.

To sweeten the deal, insurers will often throw in discounts on other insurances, i.e. life insurance or home and contents.

They will not allow you to use your pension funds as equity, which means you’ll need more cash for a deposit.

Insurance companies also have a range of other rules related to amortisation, loan to value ratios, etc, which are more strictly enforced – so getting a mortgage with an insurer can be more difficult.

Some insurance companies offering mortgages in Switzerland include Allianz Suisse, Axa, Baloise Bank SoBa, Generali, Helvetia, Swiss Life and Zurich.

Go online

Another cheaper option in Switzerland when it comes to mortgages is to go online, either through an online-only mortgage from a bricks and mortar bank or an online-only financial institution.

So-called ‘neo banks’ have sprung up in recent years, which offer the services of regular banks but do not have any branches or locations.

All account management is done online, which allows them to save money, while the costs of rent and locations are also spared.

EXPLAINED: Which banks are best for foreigners in Switzerland?

Swiss financial agency Moneyland notes that those who opt for online mortgages tend to be savvy and more aware of their rights than others, which is at least in part because these mortgages tend to include less frequent consultation (thereby saving on staff costs).

Online mortgages will usually be offered by larger banks or financial institutions through associate or other companies.

While the source of the funds might be the same – i.e. an online bank connected to a bricks and mortar bank both offering mortgages – they will often use a different name so as to not cannibalise on their main offerings.

Some online mortgage options include eHypothek, Homegate, Hypomat, Migros Bank and several cantonal banks.

Please keep in mind that this was written as a guide only and should not take the place of qualified financial advice.

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