76% taxpayers below 25 report multiple income streams, up from 14% in 4 yrs | Personal Finance

Preliminary data from tax-filing platform ClearTax, based on returns filed till July 20 for Assessment Year (AY) 2026-27, shows that 76 per cent of taxpayers under 25 now report multiple income streams, up sharply from 14 per cent in AY 2022-23. Alongside salaries, many are reporting income from capital gains, stock trading, freelancing and entrepreneurial ventures, pointing to a structural shift in how young Indians are earning and building wealth.

 

The trend extends well beyond Gen Z. Across all taxpayers, the share reporting capital gains has climbed to 39 per cent, compared with 9 per cent four years ago, reflecting a 4.5-fold increase in retail participation in financial markets. Meanwhile, 26 per cent of taxpayers now report business income, up from 4 per cent in AY 2022-23, underscoring the rapid expansion of freelancing, consulting, content creation and self-employment alongside traditional salaried work.

 
 

The diversification of income is also changing the composition of tax returns. For the first time, taxpayers relying solely on salary income have fallen below half of all filers. Only 42 per cent of returns filed through ClearTax this year reported salary as the only source of income, down from 82 per cent in AY 2022-23, suggesting that multiple income streams are increasingly becoming the norm rather than the exception.

 

The trend is visible across age groups. Among senior citizens, 53 per cent now report multiple income sources, compared with 28 per cent four years ago. The proportion reporting capital gains has also nearly tripled from 15 per cent to 42 per cent, indicating that older taxpayers, too, are participating more actively in equity and other financial markets.

 

The data also points to a rising affluent taxpayer base. About 32 per cent of returns filed this year reported a gross income exceeding ₹20 lakh, compared with 22 per cent in AY 2023-24, driven by stronger investment income, business earnings and diversified sources of income.

 

“The 2026 filing season reflects a fundamental shift in India’s financial journey. Taxpayers are no longer relying solely on salary income—they are increasingly participating in capital markets, building businesses and creating multiple income streams,” said Archit Gupta, Founder and CEO of ClearTax. He added that tax filing is evolving from a compliance exercise into an important part of wealth management as financial lives become more complex.

 

Here are the key highlights: 

 

Salary-only taxpayers fall below 50 per cent

For the first time, taxpayers reporting salary as their sole source of income have fallen below the halfway mark. Only 42 per cent of taxpayers filing through ClearTax this year reported salary as their only source of income, compared with 82 per cent in AY 2022-23, indicating that multiple income streams are increasingly becoming the norm.

 

Capital gains become a mainstream income source

Participation in capital markets has accelerated significantly. Thirty-nine percent of taxpayers have reported capital gains in their returns this year—a 4.5-fold increase from 9 per cent in AY 2022-23. 

 

Business income records six-fold growth

Taxpayers reporting business income now account for 26 per cent of all returns filed through ClearTax, up from 4 per cent in AY 2022-23—a six-fold increase. 

 

Young Indians are filing increasingly sophisticated returns

India’s youngest taxpayers are entering the financial system with more diversified income profiles than ever before. Nearly 76 per cent of taxpayers below the age of 25 are filing returns with multiple income sources, compared with 14 per cent in AY 2022-23, driven by growing participation in investing, trading and freelance work alongside salaried employment.

 

Senior citizens deepen participation in capital markets

More than 53 per cent of senior citizen taxpayers now file returns with multiple income sources, compared with 28 per cent four years ago. Meanwhile, the proportion of senior citizens reporting capital gains has nearly tripled from 15 per cent to 42 per cent, highlighting increasing participation in wealth creation through financial assets.

 

Higher-income taxpayers on the rise

 

The data also points to a growing affluent taxpayer base. Thirty-two percent of returns filed this year report gross income exceeding ₹20 lakh, compared with 22 per cent in AY 2023-24, reflecting rising incomes driven by investment gains, entrepreneurship and diversified earnings.