47.3% Earn Beyond Salary: Salary and Freelance Income ITR Guide
47.3% of ClearTax self-filers reported income beyond their job in AY 2026-27, up from 9.5% four years ago. What it means if you file salary and freelance income in one ITR.
Four years ago, fewer than one in ten self-filers on ClearTax reported any income outside their job. This year, it was nearly half.
ClearTax's annual report, How India Filed in 2026, found that 47.3% of self-filers reported at least one non-salary source in AY 2026-27, against 9.5% in AY 2022-23 (Mint). If you file salary and freelance income in one ITR, you are now part of a very large crowd.
Quick answer
- 47.3% of ClearTax self-filers reported investment, business, freelancing or crypto income in AY 2026-27, up from 9.5% in AY 2022-23.
- 24.4% reported two or more non-salary sources, up from 3.5%.
- Side income usually pushes you off the simple ITR-1: 62 per cent of all ClearTax filings were non-ITR-1 this year.
- Among filers under 25, ITR-3 filings rose from 28% to 44%.
This is general information, not tax advice. Check your own return with a chartered accountant or the income tax portal before filing.
How many Indians now have income beyond their salary?
Nearly half of ClearTax's self-filers: 47.3% reported at least one non-salary source in AY 2026-27, up from 17.3% in AY 2023-24 and 9.5% in AY 2022-23.
Those sources include investments, business, freelancing and cryptocurrency. The share with two or more such sources climbed from 3.5% to 24.4% over the same four years (Mint).
ClearTax Founder and CEO Archit Gupta said more taxpayers are reporting multiple income streams, with young professionals taking up independent work and investing in equity markets (Economic Times).
A note on scope: this is ClearTax's own filing data, not the whole country. It shows the direction clearly, but it is one platform's users.
Source: ClearTax via Mint
Which ITR form do you need with salary and freelance income?
Usually not ITR-1. Once freelancing, business or capital gains sit beside your salary, most filers move to a complex return: ITR-2, ITR-3 or ITR-4.
ClearTax's data shows that shift. Non-ITR-1 filings made up 62 per cent of all its filings in AY 2026-27, compared with 53 per cent in AY 2025-26 and 40% in AY 2024-25 (Economic Times).
ITR-2 and ITR-3, which capture income from capital gains and other sources, together made up 57.2 per cent of filings, up from 36.2 per cent two years ago. Mint groups ITR-2, ITR-3 and ITR-4 as "complex returns" in the report.
The practical lesson is simple. If you took even one paid freelance project last year, do not assume the pre-filled simple form fits. Pick the form that matches every income source, not just your salary.
Why are young earners filing complex returns?
Because they are freelancing, trading and running small ventures early. 75% of self-filers under 25 filed complex returns in AY 2026-27, up from 60% a year earlier.
Within that group, ITR-3 filings rose from 28% to 44%, while ITR-1 fell from 41% to 25% (Mint). The under-25 group saw the sharpest jump of any age band.
Low income does not mean a simple return either. 73% of taxpayers reporting gross income below ₹1 lakh filed complex returns, more than any bracket up to ₹50 lakh. Among those earning ₹1-2.5 lakh, 69% did.
That fits what Times of India found on the ground. Techies are taking freelance work as a side hustle alongside full-time jobs, and students are taking freelance IT projects before they graduate (Times of India).
What most guides miss: the 73% of sub-₹1 lakh filers using complex returns is higher than the 62 per cent across all ClearTax filings, so the smallest earners are the most likely to need the harder form. A student with a few gigs and some stock trades should plan for it.
How much are freelancers in India actually earning?
Rates vary widely: skilled IT gig workers on one student platform average Rs 850 to Rs 1,500 an hour, while entry-level design or basic development pays about Rs 450 to Rs 550.
Those figures come from the platform TimbuckDo, as reported by the Times of India. Cybersecurity and testing work sit at the higher end. Routine tasks pay less as AI tools automate them.
One engineering analyst with nearly a decade of experience told the paper she earns around Rs 2,000 an hour on automation projects for clients in Australia and Texas. Many of her projects run for several months, which makes income easier to plan.
Demand looks firm. Randstad Digital expects tech gig hiring in India to rise nearly 60% from last year, and ManpowerGroup says freelance rates rose 11% year-on-year globally.
What should you do before filing with side income?
Track every rupee you earn outside your job, choose the form that covers all of it, and keep your records.
- List every source. Freelance payments, business income, interest, capital gains and crypto all count. The ClearTax data shows these are now normal, not rare (Economic Times).
- Skip ITR-1 if it doesn't fit. Salary and freelance income together usually point to a complex form.
- Report losses too. 37% of under-25 filers with capital gains or losses reported a loss, the highest of any age group.
- Keep invoices and bank records. Clean records make a complex return much easier.
- Get help if unsure. ClearTax says 82% of first-time filers on its expert-assisted plans filed complex returns.
FAQs
Can I file salary and freelance income in one ITR?
Yes. All your income goes into one return for the year. With freelance income added to salary, most people move from ITR-1 to a complex form such as ITR-3 or ITR-4. Check the form's eligibility on the income tax portal.
How many people in India have a side income?
On ClearTax, 47.3% of self-filers reported at least one non-salary income source in AY 2026-27, and 24.4% reported two or more. This is one platform's data, not a national figure.
Is freelance income taxed if I earn very little?
Low income does not mean you can skip reporting it. ClearTax data shows 73% of filers with gross income below ₹1 lakh still filed complex returns. Ask a CA how your income is taxed.
Why do young people file ITR-3?
ITR-3 filings among under-25 filers rose from 28% to 44%, as more of them trade stocks, freelance and run small ventures alongside study or jobs.
Do you file freelance income along with your salary? Tell us in the comments which form you used.
Expert review: pending.
Results vary; nothing here is a promise of income. This is not tax advice.
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