If the dog is gunshy, he is ruined. Guns (detonations) have to be introduced progressively. Once a dog has become gun shy there is no rewind or re-record.
I've helped a couple of guys who screwed up in the same manner get their dogs to at least tolerate the sight of guns, but neither was ever a reliable "go-getter" afield.
All of my hunting dogs start gun training as puppies during feeding time. Start off using a cap gun a fair distance away from them so that they will notice the sound, but be more interested in eating their food.
As their comfort level with the sound rises, I close the distance until ultimately I can rapid fire a full plastic stripper clip of caps. They are surprisingly loud.
I then move up to .22LR and follow the same pattern, until finally I break out the 12 ga.
Between my Beagles and Labradors, I can unload a full mag of 3" 12 ga Magnums next them and they won't bat an eye, merely look for the dead game.
Taking a family pet into the woods with a 12ga, with no prep and firing it off, even in moderate proximity to the dog is a sure recipe to ruin him as a hunting companion. Dogs have much more sensitive hearing than humans and things like echos and reverberations can also contribute to creatintg that pain memory.
Your best hope is to try and get the dog to equate the shotgun with a positive experience, like feeding time, or going for a walk. Start off with the cap gun and work your way up. You'll need a partner to hold the leashed dog as he/she eats, while you fire off the cap gun 40-50 yards away to start. Repeat that for a series of days until the dog starts getting comfortable with the sound, then and only then start closing the gap. Try to rush things and you guarantee yourself a failure.