The number of individuals reporting taxable income exceeding ₹1 crore has seen a dramatic rise, jumping from 44,078 in AY 2013-14 (FY 2012-13) to nearly 2.3 lakh in AY 2023-24 (FY 2022-23). This increase suggests both higher earnings and improved tax compliance, supported by the latest data from the tax department. During this period, total individual tax filings more than doubled, from 3.3 crore to over 7.5 crore.
Salaried vs. Non-Salaried High-Income Earners
Salaried individuals made up nearly 52% of those declaring incomes over ₹1 crore in AY 2023-24, compared to 49.2% in AY 2022-23 and 51% in AY 2013-14. However, as income levels rose, the dominance of salaried earners decreased. In the ₹1-5 crore income range, salaried individuals accounted for 53%, but this proportion dropped as income levels increased, with businessmen and professionals becoming more prevalent in higher brackets. Among the 23 individuals reporting income above ₹500 crore, none were salaried, while 19 out of 262 people in the ₹100-500 crore bracket were salaried.
Changes in Income Distribution
While the number of individuals earning over ₹25 crore slightly decreased from 1,812 to 1,798, the mid-range tax brackets saw significant shifts. The proportion of filings in the ₹4.5-9.5 lakh income bracket rose to 52%, from 54.6% in the ₹1.5-3.5 lakh range in AY 2013-14. Meanwhile, individuals in the ₹5.5-9.5 lakh bracket now make up one-quarter of returns, compared to one in five in the ₹2.5-3.5 lakh bracket in earlier years.
Who Needs to File an Income Tax Return in India?
Filing an income tax return (ITR) is mandatory for individuals whose taxable income exceeds the basic exemption limit. However, several other scenarios require ITR filing even if taxable income is below the exemption limit, such as holding foreign assets, spending over ₹2 lakh on foreign travel, paying electricity bills of ₹1 lakh or more, and claiming tax exemptions on capital gains. Additionally, individuals who have TDS or TCS deductions of ₹25,000 or more, or who deposit ₹1 crore or more in a current account, must file an ITR.
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