I ASSUME from the question that he is resident here, and has been for all of those 10 years? If not he needs to figure out the tax liability for the jurisdiction(s) he was resident in. If he was resident here he needs to report his world wide income here… so I’d ask him if there is any other income that he has in other countries as well so that you can make sure his filings are complete!
Based on the assumption of residence:
To start with, you will want to find out if the UK has been withholding tax on the amount. None of my clients with UK pensions have withholding taxes deducted before payment (including my mom). If he is he may claim it against his pension income since we have a tax treaty with the UK.
Then I would suggest doing a proper Voluntary Disclosure. They are a bit of work, but will protect your client from the penalties for non-reporting. He’ll still owe the tax and interest, but there shouldn’t be any penalties. If it was just a year or two I would just T1ADJ and get it over with, but given the time frame, even if he only gets a few thousand dollars a year in pension it could be $30,000+ in unreported income. The penalties could add up. From the CRA site: " Repeated failure to report income penalty
If you failed to report an amount on your return for 2018 and you also failed to report an amount on your return for 2015, 2016, or 2017, you may have to pay a federal and provincial or territorial repeated failure to report income penalty. If you did not report an amount of income of $500 or more for a tax year, it will be considered a failure to report income.
The federal and provincial or territorial penalties are each equal to the lesser of:
- 10% of the amount you failed to report on your return for 2018
- 50% of the difference between the understated tax (and/or overstated credits) related to the amount you failed to report and the amount of tax withheld related to the amount you failed to report"