What is the quotient familial and how does it reduce French income tax?

The quotient familial is France's system for sharing household income across family members to calculate income tax. It divides total household income by a number of parts (parts fiscales) based on your family situation, calculates tax on one part, then multiplies back up. More parts mean lower effective tax rates.

A single adult with no dependants has one part. A married or PACS couple has two parts. Each of the first two children adds half a part; the third and subsequent children add one full part each. Single parents and certain other situations provide additional half parts.

For example, a couple with two children has three parts. Their combined income of €90,000 is divided by three to give €30,000 per part, taxed at the progressive rates, then multiplied by three for the total tax. This is lower than if the same income were taxed across two parts.

The benefit per half-part is capped at €1,759 in 2024. This cap means the quotient familial provides most benefit to middle-income households; very high earners cap out and gain less. The cap applies to the difference between tax calculated with the full quotient versus tax calculated with two parts.