Income Tax Returns: 'How India filed in 2026' - 5 trends that reveal how young investors, salaried earners manage money

Non-salary income becomes the norm

ClearTax's "How India Filed in 2026" report shows a sharp rise in taxpayers declaring earnings beyond their salaries. In assessment year 2026-27, 47.3% of self-filers disclosed at least one non-salary income source, up from 9.5% in AY 2022-23 and 17.3% in AY 2023-24. The share reporting two or more such sources climbed from 3.5% to 24.4% over the same period. These additional streams include investments, business income, freelancing and cryptocurrency.

Young filers and complex returns

Taxpayers below 25 are moving away from the simplest return forms. Among self-filers in this age group, 75% used ITR-2, ITR-3 or ITR-4 in AY 2026-27, against 60% a year earlier. ITR-3 use rose from 28% to 44%, while ITR-1 fell from 41% to 25%. This was the steepest shift toward complex filings of any age bracket, attributed to trading, freelancing and small ventures.

Low income, high complexity

A small reported income no longer signals a simple return. As many as 73% of taxpayers declaring gross income under ₹1 lakh filed complex returns, a higher share than any bracket up to ₹50 lakh. For the ₹1-2.5 lakh group it was 69%, and 60% for those earning ₹2.5-5 lakh. Capital market transactions and freelance work are cited as factors that complicate filing even at modest income levels.

Losses, retirees and what to watch

Capital losses were most common among the youngest investors: 37% of under-25 self-filers reporting capital gains or losses declared a loss, falling to 29% for ages 25-30 and 21% for those above 60. By income, about 35% of those below ₹1 lakh reported losses, against 19% of those above ₹50 lakh. First-time filers on expert-assisted plans also skewed complex, at 82% versus 68% in AY 2024-25. Meanwhile, 40% of taxpayers above 60 reported capital gains, more than the 35% among those aged 40-50, though only 9% of seniors reported gross income above ₹20 lakh, compared with 44% of the 40-50 group. Over half of senior taxpayers filed complex…