Nearly one in three individual taxpayers filing independently through ClearTax reported annual gross income above ₹20 lakh in assessment year (AY) 2026-27, according to the company’s annual report, How India Filed in 2026. The share increased to 30.5%, compared with 22.5% in AY 2023-24. The findings also show that the proportion of self-filers reporting income above ₹50 lakh nearly doubled over three years, reaching 8% in AY 2026-27 from 4.5% in AY 2023-24. The data points to a growing presence of higher-income earners among ClearTax users.
The report highlights changes beyond income levels. More taxpayers are reporting earnings from investments, businesses, freelancing and cryptocurrency alongside employment income. Capital gains are appearing in a larger share of tax returns, while complex income tax filings are becoming more common among younger and middle-income taxpayers. However, the findings are based on ClearTax’s own filing data, including a sample of approximately 4.5 lakh users, and should not be interpreted as a nationally representative estimate of all Indian taxpayers.
Share of Taxpayers Earning Above ₹20 Lakh Rises to 30.5%
ClearTax’s report shows a steady increase in the proportion of self-filers reporting gross annual income above ₹20 lakh over the last three assessment years.
The share increased from 22.5% in AY 2023-24 to 30.5% in AY 2026-27, an increase of eight percentage points.
The growth was also visible in the higher ₹50 lakh income category, where the proportion of self-filers almost doubled.
| Assessment year | Above ₹20 lakh | Above ₹50 lakh |
|---|---|---|
| AY 2023-24 | 22.5% | 4.5% |
| AY 2024-25 | Not specified in the report summary | 5.6% |
| AY 2025-26 | Not specified in the report summary | 7.3% |
| AY 2026-27 | 30.5% | 8.0% |
Figures represent the share of ClearTax self-filers reporting gross annual income in the respective categories.
The increase suggests that more ClearTax users are reporting incomes in higher brackets. However, gross income is not the same as taxable income. Taxable income is calculated after applying eligible deductions and exemptions under the applicable tax regime.
The findings also do not establish that one-third of India’s entire taxpayer population earns above ₹20 lakh. They describe the income distribution among the platform’s self-filing users.
India’s High-Income Taxpayer Segment Is Expanding
The growth in the ₹50 lakh-plus category is particularly notable.
The share of ClearTax self-filers reporting gross income above ₹50 lakh increased from 4.5% in AY 2023-24 to 5.6% in AY 2024-25, 7.3% in AY 2025-26 and 8% in AY 2026-27.
This represents a substantial increase over three years.
ClearTax attributed the trend to a growing number of individuals reporting income from multiple sources, including investments and independent business activities.
Higher-income taxpayers are also more likely to have complicated financial portfolios involving salary, capital gains, rental income, business earnings and other investments.
As these income sources become more common, tax returns can require additional documentation and reporting.
Nearly Half of Self-Filers Report Income Beyond Salaries
One of the most significant findings concerns the diversification of income sources.
According to ClearTax, 47.3% of self-filers reported at least one source of income outside employment in AY 2026-27. This compares with just 9.5% in AY 2022-23.
These additional income sources include:
- Investment income.
- Capital gains from shares and other assets.
- Business and professional income.
- Freelancing and independent work.
- Cryptocurrency-related income.
The share of self-filers reporting income from two or more non-salary sources increased from 3.5% in AY 2022-23 to 24.4% in AY 2026-27.
| Income diversification indicator | AY 2022-23 | AY 2026-27 |
|---|---|---|
| Reporting at least one non-salary income source | 9.5% | 47.3% |
| Reporting two or more non-salary sources | 3.5% | 24.4% |
The trend indicates that a growing number of individuals are combining employment with investments, independent work and other financial activities.
For example, a salaried employee may also earn money through stock investments, freelance projects or rental property. Each additional source can affect how income must be reported in an income tax return.
Capital Gains Appear in 41.7% of Self-Filers’ Returns
Investment-related income is becoming increasingly visible in Indian tax filings.
The share of ClearTax self-filers reporting capital gains increased to 41.7% in AY 2026-27, compared with 34.4% in AY 2025-26 and 25.5% in AY 2024-25.
| Assessment year | Self-filers reporting capital gains |
|---|---|
| AY 2024-25 | 25.5% |
| AY 2025-26 | 34.4% |
| AY 2026-27 | 41.7% |
The increase reflects the growing presence of investment-related transactions in tax returns.
Capital gains can arise when individuals sell assets such as shares, mutual fund units, property or other investments at a profit. Depending on the asset and holding period, different tax rules may apply.
The growing number of capital-gains disclosures also suggests that tax filing is becoming more closely connected to participation in financial markets.
However, reporting capital gains does not necessarily mean that every investor made a profit. Some taxpayers also reported capital losses during the assessment year.
Complex Income Tax Returns Increase to 62%
The growing diversity of income sources is changing the types of income tax returns people file.
Returns other than the basic salary-focused ITR-1 accounted for 62% of ClearTax filings in AY 2026-27, compared with 53% in AY 2025-26 and 40% in AY 2024-25.
ITR-2 and ITR-3 together accounted for 57.2% of filings in AY 2026-27, compared with 48.1% a year earlier.
| Return category | What it generally covers |
|---|---|
| ITR-1 | Eligible individuals with relatively straightforward income, including salary |
| ITR-2 | Individuals and HUFs with income such as capital gains who are not eligible for ITR-1 |
| ITR-3 | Individuals and HUFs reporting business or professional income |
| ITR-4 | Eligible taxpayers using the presumptive taxation scheme |
The increasing proportion of complex returns suggests that more taxpayers are reporting financial activities beyond conventional salary income.
Stock-market investments, trading, freelance work and independent businesses can all influence the return form a taxpayer needs to use.
Young Indians Are Filing More Complex Returns
The report also highlights the growing participation of younger taxpayers in investment and independent income activities.
Among ClearTax self-filers below the age of 25, 75% filed complex returns in AY 2026-27, compared with 60% in AY 2025-26.
The share of ITR-3 filings among this group increased from 28% to 44%, while ITR-1 filings declined from 41% to 25%.
This suggests that younger taxpayers are increasingly reporting business or professional income and investment-related transactions.
However, the trend does not necessarily mean that young Indians are earning more than older taxpayers. It indicates that their financial activities are generating more complicated tax-reporting requirements.
The report also found that 37% of self-filers below 25 who reported capital gains or losses recorded a loss, the highest proportion among the age groups examined.
This highlights the importance of understanding the tax treatment of investment losses, trading activity and capital gains.
Women Make Gains in Higher-Income Categories
ClearTax’s data also indicates that women’s representation in higher-income categories is increasing.
The share of women self-filers reporting annual gross income above ₹50 lakh rose from 3.7% in AY 2025-26 to 5.1% in AY 2026-27.
Among men, the corresponding proportion increased from 9.6% to 12.2%.
For the ₹20 lakh-plus income category, the share of women self-filers increased by 23% over the year, compared with 12% among men.
However, the gap remains significant. In AY 2026-27, 27% of women self-filers reported gross income above ₹20 lakh, compared with 42% of men.
The findings suggest that women’s participation in higher-income categories is growing, although the income distribution among men and women remains different.
Taxpayers Aged 40–50 Account for the Largest Share of High Earners
Age-wise data shows that taxpayers between 40 and 50 years old have the highest proportion of individuals reporting gross income above ₹20 lakh.
| Age group | Share reporting income above ₹20 lakh |
|---|---|
| 35–40 years | 38% |
| 40–50 years | 44% |
| 50–60 years | 36% |
| Above 60 years | 9% |
The report also shows that investment activity continues after retirement.
Approximately 40% of self-filers above 60 reported capital gains in AY 2026-27, compared with 35% among those aged 40–50.
This suggests that older taxpayers continue managing investment portfolios and reporting returns from financial assets even after their regular employment income declines.
The Bigger Picture
ClearTax’s findings point to two changes in India’s personal finance landscape: a larger share of its self-filers reporting higher gross incomes and a growing diversification of income sources. Salary income is increasingly appearing alongside investment gains, business earnings and freelance income. This is also changing the complexity of tax compliance, with more people using return forms designed for multiple income categories.
However, platform-level filing data should not be confused with national income distribution statistics. ClearTax’s users may differ from the wider taxpayer population in their income levels, financial-market participation and preference for digital tax services. The findings are useful for understanding trends among its users, but government tax-return data would be needed to establish whether the same proportions apply across India.
Looking Ahead
The next few assessment years will show whether the increase in higher-income reporting continues and whether more taxpayers begin declaring income from multiple sources. Investment participation, digital financial services, freelancing and independent businesses are likely to remain important areas to watch. Tax software providers may also face growing demand for tools that simplify capital-gains reporting and business-income compliance.
For individual taxpayers, the findings underline the importance of maintaining accurate records of salary, investments, trading activity and independent earnings. As financial portfolios become more diversified, selecting the correct ITR form and reporting income accurately will become increasingly important. The expansion of complex filings suggests that tax compliance is evolving alongside the way Indians earn and manage money.
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