O'Sullivan will now have to share the £157,000 prize money on offer.
Carter will earn half of the £147,000 bonus for a maximum and the £10,000 for the highest break of the tournament, which could affect O'Sullivan's plans to buy a Bentley.
In his quarter final O'Sullivan needed a break of 64 to draw level with Chinese qualifier Liang Wenbo after the first session.
Liang, who is the first Chinese player to reach the last eight, showed no signs of nerves as he raced into a 2-0 lead with breaks of 80 and 49.
But O'Sullivan found his rhythm and runs of 109 and 58 put him 3-2 ahead.
Liang, 21, hit back with breaks of 104 and 89 only for O'Sullivan to make it 4-4 in the best-of-25 contest.
In the other afternoon session, Scotland's Stephen Maguire came back from 4-0 down to level his quarter-final against Joe Perry of England.
Perry won a cagey opener before firing in breaks of 68, 121 and 82 to take a commanding lead.
But Maguire, who reached the semi-finals at the Crucible last year, fought back after the mid-session interval and runs of 54 and 91 helped him make the score 4-4.