Since the top prize is an annuity that pays out over time, do winners have to pay any tax?
Unlike other jackpots which are awarded with a single payment, an annuity prize does have tax implications. The income element of the annuity is taxable. The winner will receive $1 million a year and ILC will arrange, through the annuity provider, to remit to the tax authorities on behalf of the winner who will have to report the income, based on the highest federal/provincial income tax rates effective in the winner’s province of residence on the day of the draw. The annuity provider will provide all required income tax forms to the winner. However neither ILC nor the annuity provider will be responsible for adjusting the tax remittance should changes in tax laws/rates occur during the time of the annuity or should the winner move to another province. The winner who opts for the single cash payment will not have their winnings taxed.
Related Questions
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- Since the top prize is an annuity that pays out over time, do winners have to pay any tax?
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