New Delhi: India’s youngest taxpayers are rapidly moving beyond the traditional salary model, with 76% of taxpayers below the age of 25 now reporting multiple income streams, according to preliminary data released by tax-filing platform ClearTax. The findings indicate a significant shift in the way Gen Z is earning, investing and building wealth, driven by freelancing, stock market participation, business income and entrepreneurship.

The data, based on income tax returns filed up to July 20 for Assessment Year (AY) 2026-27, shows a dramatic rise from just 14% of under-25 taxpayers reporting multiple income sources four years ago.

Multiple income streams become the norm

The report suggests that Gen Z is increasingly combining traditional salaried jobs with alternative sources of income.

Besides salaries, young taxpayers are reporting earnings from capital gains, stock trading, freelancing, consulting, content creation and entrepreneurial ventures, reflecting a broader transformation in India’s workforce and financial habits.

This trend is not limited to Gen Z. Across all taxpayers, income diversification has increased sharply as more Indians participate in financial markets and side businesses.

Salary-only taxpayers fall below half

One of the report’s biggest findings is that taxpayers relying solely on salary income have fallen below 50% for the first time.

Only 42% of returns filed through ClearTax this year reported salary as the sole source of income, compared with 82% in AY 2022-23, highlighting how additional earnings are becoming increasingly common.

Retail investing sees massive growth

The study also points to a sharp increase in retail participation in financial markets.

Around 39% of taxpayers now report capital gains, compared with only 9% four years ago, representing a 4.5-fold increase. This reflects growing interest in equities, mutual funds and other investment products among Indian taxpayers.

Business income rises sharply

Freelancing and entrepreneurship are also becoming increasingly popular.

According to the report, 26% of taxpayers now report business income, compared with just 4% in AY 2022-23. The rise highlights the growing role of consulting, gig work, digital content creation and self-employment alongside traditional jobs.

Senior citizens also diversifying income

The shift towards multiple income sources is visible across age groups.

More than 53% of senior citizen taxpayers now report multiple income streams, up from 28% four years ago. Meanwhile, the proportion reporting capital gains has increased from 15% to 42%, indicating greater participation in wealth creation through financial assets.

Higher-income taxpayers increasing

The report also indicates a growing affluent taxpayer base.

Around 32% of returns filed this year reported gross income above ₹20 lakh, compared with 22% in AY 2023-24. Higher investment returns, business earnings and diversified income sources have contributed to this increase.

Experts see structural change

ClearTax Founder and CEO Archit Gupta said the findings reflect a fundamental change in India’s financial landscape.

According to Gupta, tax filing is evolving beyond a compliance requirement and becoming an important part of personal wealth management as taxpayers increasingly manage multiple sources of income and investments.

Conclusion

The latest data suggests that India’s Gen Z is embracing a more diversified financial future. With increasing participation in investing, freelancing, entrepreneurship and business activities, multiple income streams are becoming the new normal rather than the exception. The trend also reflects a broader transformation in the country’s workforce, where tax returns are becoming more sophisticated as individuals build wealth through several channels.