Catch-Up Tax Filing in Mississauga — Back Taxes and Unfiled Returns
Catch-up tax filing is one of the most common engagements we take on, and one almost nobody talks about. Every year we file returns for people and corporations that are two years behind, five years behind, ten years behind. A business got busy and a year slipped. An illness took a year apart and it never restarted. The reason matters far less than the fact that this is fixable — and that waiting is the one thing that reliably makes it more expensive. Penalties are fixed the moment you file. Interest compounds daily until then. Filing stops the clock. We are not going to ask you why.
We are going to find out what is outstanding, rebuild what is missing, and file it.
Who This Is For
Personal and corporate, on one file. Most owners who come to us are behind on both.
- Individuals with a late T1 return — one year of it, or a decade of unfiled returns
- Incorporated business owners with a late T2 corporate return, or several
- Owners behind personally and corporately at once, where the T2 has to be filed before the T1 can be finished
- Anyone holding a CRA demand to file letter
- Anyone who has stopped opening CRA mail
Two years behind or ten, the starting point is identical: we get authorized with CRA, pull the complete record, and tell you where you stand before you commit to anything.
We work with individuals and Canadian-controlled private corporations in Mississauga and the GTA. We do not handle U.S. or cross-border filings, or Quebec returns.
One requirement, and it is not negotiable. We take on a catch-up file only if you have online access to your CRA account — My Account for personal returns, My Business Account for corporate. The entire process depends on it: it is how you authorize us, how we retrieve the years and slips CRA holds, and how we confirm what has already been assessed against you. Without it we are working blind, and we will not start a file that way. If you do not have online access yet, register at canada.ca before you call us.
What Happens If You Keep Waiting
This is where the cost sits. The figures below are CRA’s, not ours, and are current as of August 2026.
Late-filing penalties. On a personal return, the penalty is 5% of the balance owing plus 1% of that balance for each full month the return is late, to a maximum of 12 months. A corporate return works the same way: 5% of the unpaid tax plus 1% per complete month, to 12 months.
The repeat penalty doubles it. If CRA issued a demand to file and you were already charged a late-filing penalty in any of the three previous years, the penalty becomes 10% plus 2% per complete month, to a maximum of 20 months. That is the trap in multiple years of unfiled returns — the later years cost more than the early ones.
Interest runs on all of it. CRA’s prescribed rate on overdue taxes is 7% for July 1 to September 30, 2026, compounded daily. It runs from each year’s original due date, on the penalties as well as the tax.
CRA files for you, and you will not like the result. Subsection 152(7) of the Income Tax Act lets CRA assess “if no return has been filed.” That is an arbitrary assessment: CRA estimates your income from the slips it can see, allows no expenses and no deductions, and issues a bill. Once issued, it is a real debt, and collections can follow — wage garnishment, a hold on your bank account, a lien on property.
Benefits stop. The Canada Child Benefit, GST/HST credit, OAS and GIS, and Ontario credits are all recalculated from a filed return. No return, no payments.
The Process, Step by Step
1. Scoping call, no charge. We establish which years are outstanding, whether it is T1, T2, or both, and whether CRA has already issued a demand to file or an arbitrary assessment. Thirty minutes, no obligation, nothing submitted anywhere.
2. CRA authorization. This step is the gate. You authorize us through your CRA online account, and we finally see the whole picture: which years are actually unfiled versus which ones you only think are, every slip CRA holds — T4, T5, T3, T4A, T5008 — instalments paid, existing balances, and any assessments already raised. Most of the records people are certain they lost are already sitting in CRA’s system.
3. Rebuild the record. We fill the gaps around what CRA holds using bank and credit card statements, your QuickBooks Online file, invoices, and prior year returns. For corporate years, the financial statements get reconstructed so a defensible T2 can be prepared. Where a genuine gap remains, we use a reasonable and documented basis, and we tell you it is an estimate. We do not invent numbers.
4. Decide the filing strategy — before anything is submitted. Two decisions get made here: whether the Voluntary Disclosures Program applies, and what order the years get filed in. Both have to be settled first, because a VDP application must be made before the returns go in, not after.
5. Prepare and file. We file oldest year first so losses, carryforwards, RRSP room, capital dividend account and refundable tax balances flow correctly year to year. Filing out of order is the most common reason a catch-up file has to be redone.
6. Clean up the assessments and settle the balance. Filed returns replace arbitrary assessments with real numbers, which often reduces the balance substantially. From there we deal with what is actually owed: a payment arrangement with CRA collections, or a taxpayer relief request where circumstances support it.
The Voluntary Disclosures Program
The Voluntary Disclosures Program is CRA’s mechanism for coming forward before CRA comes to you. It was rewritten effective October 1, 2025, and the current version is more forgiving than the one most people have read about.
There are now two categories:
Unprompted — no CRA contact about the issue, or only an education letter or general guidance. Relief is 100% of penalties and 75% of interest.
Prompted — CRA has sent you something identifying a specific error or omission with a deadline to correct it, or CRA already has information from a third party. Relief is up to 100% of penalties and 25% of interest.
Both categories carry protection from criminal prosecution on the disclosed matter, and neither carries gross negligence penalties.
When it applies. The application must be voluntary, the year must be at least one year past its filing due date, there must be actual penalty or interest exposure, the supporting documents must be complete, and payment or a payment arrangement must be in place for the estimated tax owing. CRA generally requires the most recent six years of supporting documentation, or ten where foreign income or assets are involved.
When it does not apply. The application is refused if an audit or investigation has already been initiated against you, or a related taxpayer, on the matter disclosed. It does not apply to returns that would only produce a refund, or where no tax, penalty or interest is owing, and it cannot reverse penalties and interest already assessed.
The point people get wrong. A demand to file letter does not automatically end your eligibility. Under the current rules it generally moves the application from unprompted to prompted — less interest relief, but the penalty relief and prosecution protection remain. An audit or investigation is what closes the door. If you have been told the program is closed to you, that advice may be based on the old rules. Worth a second look, before you file anything.
Fixed Fee, Confirmed in Writing
Every catch-up engagement is scoped and confirmed in writing before work begins. The fee is set per year and per return type, so you know what the full file costs before you commit.
No hourly billing. No invoice at the end that is larger than the conversation you had at the start. If the scope changes once we are into the records — a rental property in one year, a dormant subsidiary nobody mentioned, a T1135 requirement — we stop, tell you, and re-quote before continuing.
You know the fee before we start.
Once you are caught up, ongoing corporate and personal filing is available through our service packages.
Frequently Asked Questions
How many years back can I file?
There is no limit on how far back you can file a return you were required to file, and if CRA has issued a demand, those years must be filed regardless of age. The limit is on money coming back: CRA will not issue a refund from an adjustment request beyond 10 calendar years, and benefits have their own retroactive limits. Older years close the obligation; recent years are where a refund is still possible.
What if I cannot pay what I owe?
File anyway. Filing late and paying late are separate problems, and the late-filing penalty grows every month the return is not filed, whether or not you can pay. Once the returns are in and the real balance is known, CRA offers formal payment arrangements, and taxpayer relief is available where circumstances such as serious illness or financial hardship apply. Not filing because you cannot pay is the most expensive decision in this area.
Will CRA charge interest on all of it?
Yes. Interest is charged at the prescribed rate — 7% for July 1 to September 30, 2026 — compounded daily from each year’s original due date, on the tax and on the penalties. That is why the order of operations matters. An accepted VDP application relieves 75% of that interest on an unprompted application and 25% on a prompted one.
Can I go to jail for this?
Failure to file is an offence under section 238 of the Income Tax Act, carrying a fine of $1,000 to $25,000, or both that fine and imprisonment for up to 12 months on summary conviction. That is the statute. What we can tell you is that an accepted Voluntary Disclosures Program application includes protection from criminal prosecution on the matter disclosed, and that the exposure only grows while the returns stay unfiled. We cannot comment on any individual case without seeing the file, and where there is genuine prosecution risk we will say so and refer you to a tax litigation lawyer.
Do I need all my old records?
No, and almost nobody does. Once you authorize us with CRA we pull the slips CRA already holds for each year. Between those, your bank statements and your accounting file, we can usually rebuild a complete and defensible return. Missing records slow the file down. They do not stop it.
Start With a Call
If you are behind on filing, the next step is a 30-minute scoping call at no charge. Have your CRA online access ready. We will tell you which years are outstanding, whether the Voluntary Disclosures Program is worth pursuing, what the likely exposure looks like, and what the fixed fee would be. You decide after that.
No judgement, and no obligation.
Note on Currency of Information
All CRA rules, penalty rates, interest rates and statutory references in this copy are current as of August 2026, and are drawn from CRA and Department of Justice sources:
– Late-filing penalties (T1 and T2), including the repeat penalty after a demand to file — CRA; Income Tax Act s. 162(1) and s. 162(2)
– Prescribed interest rate of 7% on overdue taxes — CRA prescribed interest rates, third calendar quarter of 2026 (July 1 to September 30, 2026)
– Arbitrary assessment authority — Income Tax Act s. 152(7)
– Failure-to-file offence, $1,000 to $25,000 fine and up to 12 months — Income Tax Act s. 238(1)
– Voluntary Disclosures Program relief levels, eligibility conditions and exclusions — CRA Information Circular IC00-1R7, in effect from October 1, 2025
– 10-calendar-year limit on refunds from adjustment requests — CRA