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I suffer from depression and unfortunately never filed my income tax in British Columbia, Canada. I always paid my taxes through my employer. How can I file now and what would the penalty be?

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If you are a regular kind of person there is probably no penalty. Here's how to find out.

First, gather up whatever paperwork you have - T4s and the like. Second, contact the local office of Revenue Canada and tell them you are way behind and want to get caught up. They may have some of your missing paperwork (pretty sure you have some missing paperwork) because they get copies of everything. (A member of my staff just went through this filing for an aging parent - Revenue Canada sent all kinds of bank slips and whatnot that the parent had lost.)

Third, calculate your taxes for each year you missed, starting with the furthest back because some numbers carry forward from year to year. Use some kind of software to make it faster and simpler and to ensure you don't forget any possible deductions. Each year, compare the taxes you actually needed to pay to the taxes that were sent in on your behalf. If you would have got a refund, you won't be charged a penalty for that year. (The CRA web page about this says it the other way: if you owe tax we'll charge a penalty. They leave unsaid that if you don't owe you won't be penalized.)

If at any point you hit a year where you owe, contact Revenue Canada right away and tell them what you've discovered. You may get a break from them since you have a medical reason and you're coming forward voluntarily. I doubt you will hit such a year, because the amounts employers are required to withhold generally ensure a small refund for everyone. You should be fine.

If you are a "trust fund baby" or in any way have huge amounts of income that nobody withheld on, then you should get a lawyer involved in this process. They have confidentiality clauses that accountants do not. But if you're a regular person with a job, just catch up on your returns, claim your ancient small refunds, and feel good about having one less thing you're behind on.

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    Calling the CRA - cra-arc.gc.ca/cntct/phn-eng.html - should be your first action. The agents are usually very knowledgeable and helpful. They will guide you through the steps you need to take and forms you need to submit, and their advice will be tailored to your specific situation - since they can look up your info using your SIN.
    – SaltyNuts
    Mar 24, 2015 at 19:02
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    I hardly think calling them before even sorting out what paperwork you have on hand is wise. A few minutes for an inventory will be time well spent. And one of those forms will have your SIN should you not have it memorized. So I'll leave "calling them" as the second step.
    – Kate Gregory
    Mar 24, 2015 at 19:32
  • (Above comment should be deleted)Regarding the comment about the comment about the CRA page and unsaid comment about not being penalized if you do not owe. This is a common misunderstanding but is not 100% accurate. You may not owe and are entitled to a refund but if you happen to own property outside of Canada then missing filing results in fines which accrue on a daily basis up to a maximum. Even with this cap it becomes significant year over year. The bottom line is you still have an obligation to file on time even if you are due a refund and in certain cases there are penalties.
    – cclark
    Mar 26, 2015 at 19:59

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