Why more than half of French households do not pay income tax

Around half of French households do not pay any income tax, which can often come as a pleasant surprise for those who move to the country. 

France’s system of taxing income at source, alongside allowances, tax credits and the ‘family quotient system’ that reduces tax proportionally for larger families, means millions of people have no net income tax payable on income for a given year.

In fact, in the summer around a third of households receive refunds of tax-at-source taken off provisionally after their annual declarations have been made in the spring following the French tax year (which is the same as the calendar year).

Rates of at-source levies are then readjusted for incomes received from September, based on your declaration.

For people whose real income has not changed since they declared 2023’s income in 2024, an increase in France’s tax bands this year of 1.8% – linked to inflation in 2024 – means they will be paying less tax or perhaps none at all. 

This is because a higher percentage of your income falls into the lower-rate or zero-rate bands. 

Note these increases are also being applied to allowances for elderly and disabled declarants, also helping to ensure that if they did not pay income tax last year and their level of income has not changed or has risen only with inflation, they should not have to pay any this year either.

Family quotient helps limit tax

You can find 2025’s tax bands here.

However, these rates do not tell the whole story. 

For example, the first payable band, at 11%, starts at €11,498 but a system called the décote - which further lowers tax bills of modest-earners - as well as tax not being collected on payments of under €62 means that you have to earn more than this to start paying tax. 

For a single person living alone the actual amount of annual income at which they will start paying income tax is €17,438 and a married or Pacsed couple without dependents (who declare together in the same foyer - household) will only pay from €32,572. 

These amounts do not factor in any tax credits a person may be eligible for, which would further increase the amount of tax-free income they may earn.

Read more: What is the maximum amount a person can earn before they pay income tax in France?

The ‘family quotient’ system, involving a figure known as the parts – also increases the amount a household can earn tax free.

Children are worth one half ‘part’ for the first two, then one whole part from the third. Having a disability can also raise the number of a household’s parts. The more parts a family has, the greater the benefit.