India`s New Taxpayer Is Hybrid: ClearTax`s How India Filed in 2025 Report
India’s tax-filing landscape is undergoing a decisive reset, with new data from ClearTax - India’s largest tax filing platform - indicating that the country is transitioning away from a traditional, salary-dependent income model towards a far more layered, multi-income system. ClearTax’s annual filing report for 2025 - ‘How India Filed in 2025’, shows that Indians, especially Millennials and Gen Z are increasingly combining salaries with business income, capital gains, F&O trading and even digital assets. This shift signals the rise of what the company describes as the “Hybrid Indian”, a taxpayer who seamlessly manages multiple streams of income through digital platforms.
The most striking transformation appears in the composition of returns filed this year. ITR-3 filings, representing taxpayers with business and trading income, surged by 45.4%, while ITR-2 filings covering capital gains and investment income rose 17% year-on-year. This marks a fundamental shift: tax returns are no longer mere salary documents but have evolved into comprehensive financial biographies capturing every facet of an individual’s earning and investment behaviour.
The 25–35-year-olds are driving this multi-income transformation. Traditionally considered the backbone of India’s salaried workforce, they now account for 42.3% of all ITR-3 filings and form the largest share of both new and returning trading taxpayers. According to ClearTax, this cohort is India’s most financially active generation, characterised by digital fluency, higher risk appetite and a growing preference for income diversification through markets and business activity.
Gen Z is demonstrating an equally remarkable shift. Among taxpayers under 25 years, ITR-2 growth of 18% year-on-year suggests first-time filing is no longer just salary or internship income, but increasingly includes investments too. These trends indicate that Gen Z is entering the formal tax system with early exposure to markets, investing and wealth creation, marking a generational change in how young Indians begin their financial journey.
Crypto, while still niche, also fits into this evolving financial profile. ClearTax data shows that 76.63% of Virtual Digital Asset (VDA) filers are men, nearly 40% fall within the 25–35 age bracket, half of which are ITR-3 traders. This suggests that crypto is emerging as an additional asset, added to an already diverse financial portfolio.
The report also points to a clear peak-earning phase in India’s salaried economy: 38.1% of salaried filers in the 40–50 age group earn above ?30 lakh annually, making it India’s prime earning decade.
Commenting on the findings, Archit Gupta, Founder & CEO, Clear, said, “India’s tax data is telling a very different story than it did a decade ago. The surge in multi-income filers shows that Indians are no longer relying on a single source of earnings. They are combining salary with capital gains, trading, and business income, and building portfolios that are more layered and resilient. This shift is driven by digital access and a stronger preference for market-linked earnings. Younger taxpayers are entering the system with investing behaviour once seen only in seasoned investors, and this mindset will shape India’s economy for the next two decades. At ClearTax, we’re building to simplify finance for this new, multi-income India.”
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