My wife is a homemaker and doesnt have any income other than interest on some past savings and investment. She received an SMS from IT dept yesterday asking her to file her ITR or submit online response on compliance portal. Will she need to file or submit this response? If yes, what is the criteria?

Ans: Explanation to I. Tax department on compliance portal may be sufficient. It is difficult that proceedings may be started against her till the time income on total income is paid (ie your income as well as your spouse's income).
Further, you may need to disclose the clubbed income seperately in your return of income. Since you may be disclosing everything like your income, there are chances that income tax feels that your spouse has not paid taxes on her income. Disclosing it correctly is equally important here.

Ans: Disclosing it appropriately in your return is important.

Seperate return for your wife may not be required.

Ans: There could be many layers to it, and so it's important to consult with a tax professional for tailored solution to your specific situation.

When you file your income tax return (ITR) by clubbing your wife's income, it typically means that both your incomes are reported together in a single return. In such cases, it's important to ensure that all relevant details and incomes are correctly disclosed while filing the ITR.

Regarding the SMS you received, it's possible that there might be some discrepancy or confusion in the information received by the income tax department. Responding to the e-campaign with your ITR Acknowledgment Number and the date of filing should provide them with the necessary information.

However, if your wife has a separate source of income or if there are specific requirements for her to file a separate return, it's advisable to clarify this with a tax professional. The income tax department may require separate filings for individuals with their own sources of income.

If there are any discrepancies or if the income tax department requires additional information, they may initiate proceedings. It's crucial to respond to any communication from the tax department promptly and accurately.

To ensure you have the most accurate and up-to-date information, consider consulting with a tax professional or reaching out to the income tax department directly to seek more clarification on the specific requirements for your situation.