ClearTax - Enhancing the Tax-Filing and Making Returns Easy for India!

Tax filing is a tedious task! Be it layman or a CA, it gets time-consuming and cumbersome to a great extent. Then came in a startup in 2011 that made this process simpler for the people. Founded by Archit Gupta, Srivatsan Chari, and Ankit Solanki, ClearTax provides a range of services to clients including tax preparation, e-filing, accounting, and investment planning solutions for individuals and businesses.

Read this article to know more about ClearTax, founders, team, how it was started, startup challenges, competitors, funding, and investors.

ClearTax - Company Highlights

Startup Name ClearTax
Headquarter Bengaluru, India
Sector FinTech
Founders Ankit Solanki, Archit Gupta, Srivatsan Chari
Founded 2011
Parent Organization Defmacro Software Pvt. Ltd.
Website cleartax.in

About Cleartax and How it Works
Founders of Cleartax and team
How was Cleartax Started?
Cleartax - Startup Launch
Cleartax - Funding and Investors
Cleartax - Startup Challenges
Cleartax - Acquisitions
Cleartax - Competitors
Cleartax - Advisors and Mentors


Check out this list of 20 Best Fintech Startups in India


About Cleartax and How it Works

ClearTax is Built on top of India’s Massive Digitization of its Tax Systems. They are a Bangalore based Financial-Technology platform providing solutions for Income Tax filing, GST and Mutual Fund Investments.

The startup helps individual consumers, CAs, and businesses to prepare and file their tax returns by easy and effective means. For individual users, the process at Cleartax is super simple and easy to understand. The user simply has to upload the Form 16 pdf to begin tax filing. This software reads all of it and fills out the tax return automatically and instantly. Thus, Cleartax eliminates any human factor intervention in computing and filing of tax returns. The customer gets a fully-prepared tax return in just a matter of seconds.

ClearTax Logo
ClearTax Logo

And that’s not it. There’s more that the company brings to the table. The portal also helps users through complex scenarios like job transition, in this case, the user will receive multiple form 16s so that this software can help you accommodate the changes too. Say, for example, one has forgotten to claim HRA, it takes care of that as well.

On the same grounds, the customer can apply for tax refunds, calculate capital gain/loss if the user has sold stocks or MFs, then Cleartax helps you carry forward losses to multiple years, incorporate companies, and also undertake service tax registrations easily and efficiently.

Founders of Cleartax and team

Cleartax is founded by 3 friends, Archit Gupta, Srivatsan Chari, and Ankit Solanki.

Founders of ClearTax
Ankit, Archit, and Srivatsan

Archit Gupta is the founder and CEO of ClearTax. Before setting up ClearTax, he worked at Data Domain Inc which was acquired by EMC2. He holds a bachelor's degree in computer science from IIT Guwahati and a master’s in computer sciences from the University of Wisconsin Madison. He worked in Silicon Valley for three years and this is when he was exposed to the startup culture in the valley. He is also known to be pursuing a Ph.D.

Srivatsan Chari is Co-founder & Head of Product at ClearTax. He did his bachelor's in Computer Science (Hons) from Birla Institute of Technology and Science, Pilani.

Ankit Solanki is Co-Founder & CTO at ClearTax. He holds a bachelor's degree in Information Technology from the S.I.E.S. Graduate School of Technology.

ClearTax Team
ClearTax Team

Relevant read: ClearTax launches feature of Nil GST Return Filing for CAs and Businesses


How was Cleartax Started?

During his masters and the later years, Archit was living in San Francisco and used to visit home for the summers. During one of his visits, in 2010, he happened to have an informal talk with his father, a Chartered Accountant in Delhi. The conversation was about how doing taxes was a tedious and difficult task for both individual consumers and CAs. And how the available computing software makes tax filing so problematic and complex that led to the genesis of an idea that the whole process is time-consuming and hectic.

Within no time, Archit started fixating on the problem and started thinking to himself that it'd be great if he could figure out a way to create a software for India to help ease the tax filing process. And in the following months, he moved to India to solve this problem.

There were multiple layers of complexity to this problem and it wasn't easy as it seemed from the top. Since he was from the computer field, this tax and finances came out to be a new experience for him and hence it took him a while to get used to the aesthetics. It required for Archit to spend a lot of time with CAs, combined with a lot of learning, understanding, and going deep into the deeper insights about the industry. It was like starting from scratch for Arpit. And thus Cleartax was born.

“When I started thinking about ClearTax, I was not thinking what the market would be or how big it would be. All I thought was it was a need that should be solved.” said Archit Gupta, founder and CEO of ClearTax.

Cleartax - Startup Launch

“I had no marketing budget at that time. So all I did was send emails to friends or people I knew to try the product. But within two hours of the website going live, somebody had filed a tax return. That was a crazy moment for us.” said Archit Gupta, owner of ClearTax.

And that’s how he launched Cleartax.

From that moment onwards, there was no looking back for Cleartax. In the coming 11 days after the launch, more than 1,000 people came on the site to file their tax returns on the portal. The funder and the core team were on the edge all the time and kept working day and night to keep adding feature after feature at breakneck speeds as and when the consumers would call up and ask for more support features. Some of the examples of added features on consumer demand are rental income or provision for two salaries.

ClearTax Office
ClearTax Office

In just the following year of inception, Cleartax had more than 30K-40K users filing their returns on the platform. The figures kept jumping from 100K to 300K, to 1 million, five years down the lane. From San Francisco to Delhi and from a cushy academic career to an entrepreneur, it’s been a heck of a journey for Archit Gupta.


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Cleartax - Funding and Investors

ClearTax has raised a total of $65.3M in funding over 5 rounds. It’s last funding, Series B, was raised in October 2018 for $50 Million, Composite capital Management being the lead investor.

Here is a list of all the funding rounds of ClearTax:

Date Stage Amount Investors
August 2014 Pre Seed Round - Sumon Sadhu
April 2016 Angel Round $1.3 million Max Levchin, Scott Banister
May 2016 Seed Round $2 million Founders Fund, Sequoia Capital
June 2016 Series A $12 million SAIF Partners
October 2018 Series B $50 million Composite Capital Management

Cleartax - Startup Challenges

As mentioned above, Archit had to start from scratch about anything and everything about tax filing and returns which were initial challenges that the founder had to face. Secondly, Archit had to go on to bootstrapping the company because back then, the capital was very difficult to raise. Given that, he also had a very big challenge on hand, that was to build a product software company based out of India with almost no precedents to look up to in the field.

Cleartax - Acquisitions

ClearTax has acquired 3 organizations.

Acquired Date
Tootl April 2018
Dose FM October 2019
Karvy - GST filing Services March 2020

Karvy - GST filing Services provides tax filing services, Dose FM is India's first audio entertainment app, and Tootl is one place to follow and update yourself with all your general and niche interests.


Relevant read: Goalwise - Goal-Based Mutual Fund Investing


Cleartax - Competitors

Cleartax has competitors in individual services that it caters to. H&R Block and Webtel are the significant competitors in the tax filing space that ClearTax directly competes with. When it comes to the GST space, the startup directly or indirectly competes with Cygnet, Tally, and Computex. It's mutual fund platform competes with entities like Paytm Money, ETMONEY, Groww, Zerodha amongst others.

Cleartax - Advisors and Mentors

As ClearTax took this journey, they have added mentors and Investors like Max Levchin, founder of Paypal, Vijay Shekhar Sharma of Paytm, Neeraj Arora of Whatsapp, Peter Thiel’s Founders Fund, Sequoia, and Ryan Peterson of Flexport.

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About Rishabh Rathi

I am a computer science student and freelancer. I love learning new things and challenging myself.
  • Nagpur