With iOS 14.2, users have the ability to share subscriptions with family members. You can find the option under the subscription setting of the Apple App Store. The share new subscription feature is turned on by default allowing you to share the subscription of the applications with a recurring payment scheme.
At the keynote launch and announcement of iOS14, iPadOS 14, and macOS BigSur, Apple had detailed the features of the family plan and also introduced Apple One which brings all Apple services such as News, Health, Music under one single subscription plan. The feature is now applicable to third-party applications and the developers can decide whether to include the family sharing feature for their application or not.
Before this, if a family member purchased an application that included a subscription there was no official way to share these subscription features with other members of the family. Whenever the app is installed that allows family sharing of subscription, you get a prompt to decide whether you want to allow it as family sharing or not.
One thing to note, at the moment users cannot share purchases made within an application. At this time only the recurring subscription is shared and not the individual purchases made by the family members. Although this feature might come in the future, there is no date for it at the moment.