Claiming a Prize — Are you a lottery winner?

Publicity and Income Tax

You, the Media and the Publicity Surrounding your Win

As stipulated on the back of lottery tickets, Loto-Québec reserves the right to publish the name, region address and photograph of any winners. This rule is one of the conditions of participating in the game, which allows Loto-Québec to provide the public with proof of the prizes won by consumers. This constitutes a fundamental transparency issue.

As a winner of a major prize, you may be asked, depending on advertising needs, to take part in a photo session and a brief interview about the circumstances surrounding your win. The following rules apply to the photo session:

• The face must be uncovered
• Overt theatrics are not permitted
• Loto‑Québec might require photo ID to confirm the winner’s usual appearance.

If a winner refuses to comply to these rules, Loto‑Québec reserves the right to suspend payment of the prize. The same rules apply to prizes claimed by mail.

The information gathered may be used to write a press release sent to the media. In some cases, your stroke of luck could be advertised on Loto‑Québec’s Web site, on the digital displays at some of our points of sale.

However, in order to attenuate as much as possible any potential inconvenience, Loto-Québec applies the following rules, which have been approved by its shareholder, Québec’s Minister of Finance.

• A 10 days delay is applied between the time a major prize is claimed and the issuing of a press release to the media. This period allows you to catch your breath and to take the steps of your choice with peace of mind (notify family and employer, meet with a financial adviser, change telephone numbers, install an alarm system, plan a trip, etc.)
• Aside from the name and the photograph, information released about the winners remains of a general nature. As an example, we will indicate the winner’s region rather than the town or village, the kind of work instead of the actual place of work, and no details will be revealed concerning family status, the number and age of children, etc.
• Tight supervision of winners is ensured by Loto‑Québec Customer Service staff. In addition to being provided with counselling and literature, millionaires are able to reach a Customer Service staff member via a dedicated telephone number. Furthermore, the staff member who greets a top prize winner will place a follow-up call one month later to enquire about the winner’s new situation.
• Winners have the last word concerning the possibility of holding a press conference. The pros and cons of such an event will have been explained to the winners by Loto‑Québec to ahead of time to allow them to make a decision. If, when you come to claim a prize or hold a press conference, the winner encounter journalists at our offices, Loto‑Québec staff will be available to assist. Winners should not let themselves be intimidated by journalists and must feel free to decline to answer any question deemed inappropriate.

Winners and Taxes

Lottery winnings are not taxable. Thus, no federal or provincial taxes are payable on the winnings themselves. However, revenue generated by this capital (interest or other revenue) is taxable.

Taxation laws on investment income are complex. Taxation measures vary according to circumstances and type of investment. A person who wins a large sum in a lottery may benefit from the services of a tax specialist or the help of an agent from the Québec Ministry of Revenue or the Canada Customs and Revenue Agency.

Gifts to spouses, significant others or any other person

Money given by winners of a prize to any person of his or her choice is not taxable. Individuals who receive such gifts do not have to declare these sums as taxable income. However, if the recipient is a resident of Canada, he or she must declare revenue from interest and other profits generated by such gifts or by goods acquired with these gifts.

In the case of gifts made to a spouse or a minor (a person under 18 years of age, having a relationship of dependence with the winner, or a nephew or niece), the winner retains full responsibility for profits or losses resulting from such gifts. Thus, the winner is required to include, when calculating his or her personal income, profits or losses resulting from sums thus bestowed.

Winners are subject to this law so long as they reside in Canada, are married to the person to whom they have given money, and until the minor to whom they have given money has reached the age of majority.

Keep in mind

Certain other details could come into play. Therefore, we recommend consulting a tax expert on this subject.

Lottery winnings and family patrimony

Lottery winnings and interest accrued on them are not considered to be part of the family estate. Consult a professional (a notary or lawyer) for more information on this subject.

Gifts to charitable organizations

Donations made to charitable organizations are tax exempt.

Once again, tax credits for the sum of donations given over the course of a given year are subject to certain rules. Therefore, it is advisable to seek professional advice on this subject.

Winners are sometimes contacted by strangers asking for financial assistance or a charitable donation. Such solicitations need to be handled with caution, especially those made verbally.

It is important not to accede to this type of request without knowing more about the person or organization making the request. Winners should verify the authenticity of the speaker. It is critical to obtain information in writing about: the organization purportedly being represented; the work supported by the organization; and the registration numbers for charitable organizations issued by the tax authorities. Winners should be especially wary of solicitors who pressure them to make a decision.

Lottery winnings and government benefits

If a winner receives social assistance, a disability pension or any other form of government benefit, he or she must inform the appropriate authorities about the win as soon as possible. Winners are advised to ask the organization for all necessary information concerning the impact the win will have on their beneficiary status, and to seek legal advice, if necessary.

NOTE:
Please note that visitors from foreign countries who buy tickets in Canada and win a cash prize must inquire about current taxation laws in their own countries.