Help! I haven't filed my taxes in years.

Dear Bruce,

Help! I haven’t filed my taxes in a few years (I know, I know) and I feel overwhelmed. Am I going to be penalized? Where do I start? — Jolanta

You start by taking three very deep breaths. Filing your taxes will give you peace of mind, I promise, even if the process is difficult. But it could also mean cash in your pocket if you’re eligible for a refund.

The amount of work it’ll take depends on your situation. If you have a salaried job, it will be pretty simple. If you run your own business and have to organize lots of receipts, it will be more complicated. I recommend you hire an accountant to make sure you find every tax credit and deduction you qualify for, and to help you manage procrastination and fear. Ask friends for a referral and get a shoebox for your papers.

Now, if you do end up owing money, you will have to pay interest on what you owe, plus a late-filing penalty. The Canada Revenue Agency (CRA) says that the penalty for not filing your 2014 return on time will be “five percent of your balance owing, plus one percent for each full month your return is late, to a maximum of 12 months.” Previous years may cost you more, but the CRA might cut you some slack on the penalties if you can prove that you’ve suffered a serious illness or mental distress, such as a death in the family. In the event that you can’t afford to pay what you owe, call the CRA and work with it to sort out a payment plan. Good luck!

Bruce Sellery is a personal finance expert and author of the bestselling book The Moolala Guide to Rockin’ Your RRSP. He’s a columnist for MoneySense magazine and a regular guest on Cityline and the Lang & O’Leary Exchange. Read more at moolala.ca.

Have a question about your finances? Email Bruce at letters@chatelaine.rogers.com