I Discovered a Maths Loophole in UK Tax
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- čas přidán 19. 04. 2023
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Yet to be sponsored by Hubbard's Foodstore Spaghetti Rings in Tomato Sauce. Click here for 0% off your order! www.sainsburys.co.uk/gol-ui/p...
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CORRECTIONS
- At 05:56 I say “standard leap year” when I mean “standard year”. Sorry! First noticed and reported by Blueboy5678 and Hari Krishnan.
- User “Go Away” corrected a typo in the above correction.
- Let me know if you spot anything else!
Filming and editing by Alex Genn-Bash
Graphics by William Marler
Written, performed and embezzled by Matt Parker
Produced by Nicole Jacobus
Music by Howard Carter
Design by Simon Wright and Adam Robinson
MATT PARKER: Stand-up Mathematician
Website: standupmaths.com/
US book: www.penguinrandomhouse.com/bo...
UK book: mathsgear.co.uk/collections/b... - Zábava
It feels like the Sainsbury pricing loophole discovered by Matt's team may be a bigger problem than the tax loophole here.
I've seen posts on Reddit in the past year about UK grocery stores mis-pricing foodstuffs either at the shelf or at the register, so apparently it's an epidemic!
James May said it first years ago with Sainsbury Taste the Difference cheese.
Are we sure there weren't discounts at the bottom of the receipt? So the itemised prices were still the full amount but adjusted at the end.
Soo many unanswered questions! We need an investigation into sansburys!
@@dancrooksycamore In the US a lot of those are "club price" that requires you to have their (usually free) saver membership at the store.
I think the more dramatic reveal of this video is that apparently Sainsbury's is running a false pricing scheme
Classic case of burying the lead
Shouldn't the monetary department of the govt of UK fix that?
@@MoneyChanger02 lede (and no, i'm not fun at parties)
Happened in Portugal with Pingo Doce. Not that they fake prices but sometimes if you, for example, buy 100g of apples, sometimes they'll charge you as if you bought more, so you need to check if the weight on your check is correct. It was on the news just last week actually
I’m in Australia and the standard practice for price discrepancies like that at major retailers is that you get the first item free, and subsequent items at the shelf price.
Charging £1.05 for a can of minimum quality spaghetti hoops listed at 16p is absolutely insane. Now I'm paranoid that I've been massively overpaying for my shopping without even noticing.
I always check my receipt every time
They're definitely meant to be 16p, there's been a huge error on Sainsburys end somewhere.
Discounts are often taken off at the end of the receipt, it may have been that.
@@1224chrisng as you are someone who always checks, how often are the receipts wrong? asking as someone who has never checked
this same concept applies to people that do not check their timestamps.
your employer is NOT above ripping you off!!
So how is no one talking about the fact, that he says: "I'm going to fix my own tax problems" and in the next shot he is standing in zurich, switzerland😂
Yeah, I cracked up as soon as I recognised the Landesmuseum behind him, lol
No wonder he has no money 💸 , would have worked in Liechtenstein just as good even if it isn't Luxembourg.😂
He said, "I'm here in England", so why should I think that's not right? And to me the buildings look quite "British".
But well, cars running on the right side in England? 😂
When he said "here in England" I assumed we were probably not in England, but had no idea where that was :D Thank you for educating me
Because it was obvious. That was the joke. To explain a joke makes it not funny any more.
Expectation: how the government is ripping you off
Reality: how Sainsbury is ripping you off
Except they don't get to keep that money. Anything listed in a tax field goes straight to the government.
@@snex000Watch the video before you comment
@@complainer406 Right after you fix CZcams to work that way.
@@williamcurtis2145 Wouldn't put it past the UK.
@@snex000 It does work that way, you have to scroll past the video to read and write comments
This video has taught me to double check prices in stores. The shelf saying 0.16 for something 1.05 is outrageous!
I don't know how does it work in the UK but in my country you can legitemally pay for it 0.16 and they wont be able to charge you more
Probably said 16p per 100g or whatever
@@ThePizzabrothersGaming could be a classical scam like this. But in this case still would be wrong, it doesnt look like a 700g can unless it's filled with cement
@@ThePizzabrothersGaming Label clearly says 16p each if you put the video on 4k resolution.
@@ThePizzabrothersGaming items that come in a fixed quantity never have the main price listed on a "per 100g" basis. If that info is on the sign, it's much smaller than the actual price of the product.
I like to imagine Matt spent a solid 17 minutes explaining this to his accountant while their eyes glazed over.
That's just an accountant's default expression. I'm sure they found it interesting.
As a minor who doesn't live in the UK or pay taxes, this feels very relevant to me
Don't worry, you do in fact pay taxes. Your parents just do it for you.
You pay taxes everytime you buy something. So unless you never bought anything in your life, you pay taxes.
@@MaxwellTornado As a minor, they're probably a tax deduction for their parents!
There's a chance you'll pay taxes at some point in your life. The relevance is to pay attention when you do. Unless it's a type of tax that's calculated for you, like sales tax, it's important to know what's going on.
If we learned anything today, it is to always document the shelf price of anything you pick up at sainsburys, and check the price after scanning.
Good thing everything in my country has an MRP (Maximum Retail Price) written on every product so no need to check the shelf price until there is a discount.
Seems a habit worth picking up. It'll save more money than the tax shenanigans at the very least
If it's anything like my Sainsburys store, lots of the prices on shelves still haven't been updated with their new inflated prices. Benefit of SmartShop is that you can see what things actually cost where they've "forgotten" to update the ticket.
Edit: The spaghetti hoops just seemed plain wrong though.
@@groundcontrolto I dunno about the UK, but here in Canada, if there's a price on the shelf, they're required to honor it regardless of how wrong or out of date it is, and usually the guy running the price check will update it on the spot...
@@MaverickBlue42 Yeah I'm sure they probably would if I went and asked about it. But as it's one item out of tens in my weekly shop I don't think much about it.
As a non-resident of the UK, living in the USA, I now know _less_ about UK tax law than before I started watching. Thank you, Matt, for freeing up space in my brain.
Thankfully, you don't have to understand anything if you're just a salaried worker.
At most you'll just get a cheque/bill in April if the government charged you too little/too much tax.
It's mostly when you're self employed, or have additional sources of income, that it gets complex as there are additional rules and you have to complete a self assessment.
For National Insurance you only need to care about how it works if you're a payroll assistant or maybe an accountant
The Dunning-Kroeger effect in action! You know more, but *think* you know less!
@@charliefranklin8523 Thats technically true but its funny to see someone reference the Dunning-Kroeger effect in this context lol.
@@ad3z10 A little understanding is very helpful, which is why how taxes work should be taught in schools. It affects just about everyone so it's worth knowing.
I've been a payroll clerk in the past, and you would be surprised how often I had to explain to worried workers that getting a pay rise or working more hours never leaves you with less money even if it takes you into the next tax band. Far too many people think that it's smart to limit your earnings to just below the first tax boundary, and if they earn a penny more the evil government will take away a third of their earnings.
That joke at the end got me, you're 100% in the UK and absolutely not in Zurich avoiding your taxes 🤣
In Québec, Canada, there's a law to protect consumers from incorrect pricing in stores. For one, if any item of $10 or less scans at the wrong price at the cash, the store has to give it to you for free. For higher prices there's some kind of discount ratio.
That is a good rule! If Walmart would apply that rule they are probably bankrupt within a month ;-)
This same rule exists in the two major Australian grocery stores too
If the item costs more than $10, you get $10 off
Indeed, they have to sell it at shelf price minus 10$ (whatever is the scanned price), or for free if shelf price is under 10$. If you have several identical items, you only get the 10$ rebate on the first item, and others at shelf price. That's in a all kind of store afaik.
It used to be in Michigan that if the stamped price was different than the scanned price, you could get 10 times difference, up to $5. But then the requirement to stamp items was eliminated, to reduce the time to stock shelves.
Reminder to always check your receipts before leaving the store when making pedantic maths videos
Or simply buy your groceries online
I'm surprised that people are only just realising this happens, it's been happening for as many years as I can remember in the UK at least.
Morrisons errors are usually in your favour.
Tescos rarely ever makes any pricing errors like this.
Asda only makes 'errors' that are bad for you.
Sainsburys, well just watch the video.
@@B3Band Not everyone can. And at least over here, it's heaps more expensive than going down to the store.
Doesn't matter if you check A shop does not have to sell an item at the price on the shelf. So unfortunately for you if you buy the item at a different price to the one on the shelf you just have to accept it as your not entitled to a refund or the difference. Checking your reciept afterwards makes no difference
I love this "anti-clickbait" way of answering the title of the video immediately after video starts playing! (or telling you where to jump)
First I saw Tom Scott doing this, now Matt Parker, I really hope that more people will follow and change the clickbait mentality! ♥
TheLockpickingLawyer is also very good at not wasting viewer's time. In fact, it is one of his main focus points when it comes to making videos
You won't BELIEVE how much Sainsbury's charges for Spaghetti in a can. #5 will BLOW YOUR MIND!!!
Some people are too insecure about their own ability to retain an audience, or insecure about their ability to earn money, so they need to use "tactics" rather than their own talent to draw and retain viewers.
There are videos I've clicked on, and even entire channels I've subscribed to, simply from the question being posed in the title of some video that showed up in my feed being answered plainly and concisely right in the thumbnail.
veritasium have a good video explaining clickbait ("Clickbait is Unreasonably Effective") if anyone is curious
I think Stand Up Maths now needs to do a follow up video where we teach some of the team members how to interpret Sainsbury's pricing signs.
It appears the rule of thumb should be: Take the price printed on the shelf and multiply it by 7
@@TestTestGo Is it 7 like 7 or something like 7.3342?
Stand Up Maths is going further into its investigative journalism.
I imagine the 4 1/3 comes from dividing 52 weeks by 12 months (comes out at exactly 4.33333...).
Yep! I had to scroll for several minutes to find this comment, and I was about to just post it myself. Seemed pretty obvious to me. 😅
That factoid would have made this video a whole lot shorter...
If you're paid weekly, your annual income is 52x weekly pay most years. Except the occasional year where you get paid 53 times - every 6 years or so.
If they used the correct ratio, a weekly payee vs a monthly payee with the exact same actual annual income would pay different amounts for the year. (Either more or less depending if it's a 52 or 53 paychecks year).
Using the correct ratio is fairer in the long run but it doesn't feel that satisfactory either if you look at one year in isolation.
This got me curious so I checked my payslip. My weekly pay is exactly my nominal annual salary divided by 52. So on average I'm actually paid about 0.34% more than what my contract says.
But if you think about the alternative - dividing by 52.17... on most years actual income would be slightly below what the contract says, and HR might get questions and have to explain math to anyone who noticed and complains.
@Bobson Dugnutt I don't understand this distinction between getting paid weekly or monthly. Surely some people are paid fortnightly, or are paid by the hour and therefore earn different amounts any given week or month. My point is that, if the government believes their conversion is correct, then you can express your total annual salary as either a weekly or monthly average, at your own choice, meaning everyone can enjoy the extra cash. Or is there something peculiar about stating income in the UK that I'm not familiar with (being from Australia myself)?
@@neiltinley4858 there is something peculiar about NI, in that the thresholds apply on a weekly or monthly basis.
For Income Tax, the thresholds are annual - for example, if your annual tax-free allowance is 12k, then you can earn £1k per month without paying tax, but you could also earn £12k in a single month and not pay any tax, provided you didn't earn anything else for the rest of the tax year. Because of the way that the PAYE system works, it's likely that you'll pay tax during the month that you're paid, but you can then claim the tax back at the end of the year (sometimes earlier) because the allowances apply to the whole year.
For NI, it's calculated on a weekly or monthly basis (employer's choice, I believe). So, if you earn above the threshold in one week/month, but nothing the next week, then you can't claim back the NI you paid in the first week/month.
The other idiosyncracy about NI is that it's done per employment, rather than per person. So, if you have one main job that pays, for example, £25k per year, then that puts you firmly in the basic rate Income Tax band, and the normal NI contributions band. However, if you then have a second job, then you'll pay basic rate Income Tax on all your earnings (because you've already used up your annual allowance on your first job), but NI starts again from scratch with the weekly/monthly allowances.
I think this says more about Sainsbury's and their price discipline/comprehensibility than the minor small tax quirk !
You came to fix the tax system, you ended up exposing false advertising. I think the issue is the price they are showing below the products is a "price match" and you have to go through some sort of stupid hoop to get that price.
A spaghetti hoop, to be precise.
Currys does the exact same practice
I think at least in the US, it’s illegal to not sell it for the displayed price (excluding sales tax of course).
The Spaghetti hoops are indeed a price match price (15:24). But the chocolate bunny was labeled as 50p with a regular price (13:30).
And the worst thing is that there doesn't even seem to be enough space on the Spaghetti hoops label for the non-price matched price. (I get why, if you are regularly 5 times as expensive as the stores you compare yourself to, you really wouldn't want to tell people about that.)
In the US you even get the product for the advertised price if they have some sort of "$6 for 2" scheme going on. (Or in other words, you still pay $3 even if you buy only one item.) Whereas in Germany, that scheme would mean that you pay the regular 3.39€ or whatever it is for a single item, but they reduce it to 3.00€ per item _if_ you buy two.
I suppose digital price labels on the shelves that can be updated instantly are the solution.
Here in the USA, Walmart commonly shows the price per ounce, but also commonly it is wrong. Sometimes they will mix it up and show the price per pound, or the price per item. >:(
The 4 1/3 comes from 52/12 because even though there aren't 52 weeks in a year, there are always 52 weekly paydays in a year. The first payday of a year is usually for more than one week (covers the tail end of the previous year). Unfortunately, this means there no loophole unless you switch between weekly and monthly midyear.
I do not understand.
Suppose I am paid weekly on Saturday. If there are 52 Saturdays that year, I get paid 52 times that year. But in 2022 there were 53 Saturdays, so I would have been paid 53 times: once on 01 January 2022 for that week's work (most or all of which was probably in 2021), again on 08 January 2022 for the next week's work, ... , and finally on 31 December 2022 for the last week of that year.
The only alternative I can think of is that companies in the UK sometimes skip a payday if it crosses calendar years?
No he has just not understood how the week 53 provisions apply every 7 years and sorts this out
@@chrissmail4105that assumes that you work at the same place for 7 years, but if you work for less you will either pay more (week 53) or less (no week 53) on average
I do _not_ think most people are paid like this. People who get paid weekly will usually be paid on the same day every week. That means that each week you get exactly 7 days pay, there's no extra days to make up for. You'll get 52 paydays most years
And then some years you'll get a 53rd payday. Those are your extra days
Can't wait for part 2: showing the footage to Sainsbury's manager and demanding a refund :)
The standard leap year, does not, in fact, have 365 days 5:56
Quite agree 😂 I love a standard leap year
I love the "YES!" when Alex finds the 50p tiny chocolate bunny
We stan
I love the subtle ending with Matt moving to Zurich
Are you saying they don't have Migros in England??
@@Eli-su6ql in England, that Migros truck should avoid oncoming traffic!
A shop near me does the same pricing shenanigans and have made multiple "We're committed to blah blah blah" PR statements when they get called on it.
For the individual it's less than pennies, but if you scale it to hundreds - sometimes thousands - of customers a day, all year, it becomes a mad big number.
I bet all the errors where you would pay less then supposed get fixed ASAP too.
Having worked in a shop, not Sainsburys, I will say sometimes special promotion labels do get missed, and price updates will update on the till system before the new labels are put out. Do tell staff if you're going to get ripped off buying a can spaghetti hoops for 6.5 times more than you thought, and they should charge you at the shelf price. On top of that, some shops will have expiry dates for the offer on the label, so keep an eye out to see if it says the label has expired. Most of the time, you're not going to really have to worry, but it's useful to look out for. Really bad on Sainsbury's part, but I also know how long it can take to put those labels out, and how needing to attend to customers and other things can make it take that bit longer. Glad I don't work in retail anymore though
Sometimes, sure. But when it happens on 3 items in a bag of 7 items is evidence of scammy behaviour, not just "accidents"
@@lbeg323 When I worked for One Stop, which is owned by Tesco, we would get a batch of labels delivered by post to update price labels across the store. They would be for all kinds of items from every part of the store, just given to us to put out. The prices would already be updated on the tills, and it would just be someone's job to do that on top of the other stuff they're meant to be doing. If that person is stuck doing other stuff before they can get that done, it's going to affect prices across the store, not just in one section. It's still really bad to have these kinds of discrepancies, but it's not like staff are intentionally trying to scam people (you probably do get some staff like that, but it's going to be a real minority)
@@goodguykonrad3701 When I worked for a grocery store chain years ago, each store had one person whose primary job was to make sure all the price labels and signs were correct throughout the entire store. Only when they were done with that could they be asked to perform other duties.
Another comment thread pointed out the 16p was label as 'price match' meaning you have to literally go out of your way and somehow show or say that you know somewhere else sells that same thing for 16p, so you should to, otherwise they charge you their full price.
@@kindlin I really didn't think that's how that worked. The One Stop I worked at didn't have price matched labels, but I regularly shop at a Tesco's claiming Aldi price matches a lot of the time. I don't think I've ever noticed being charged more than was stated on the label. Looking at Sainsbury's website, they don't say you have to prove it at checkout. I don't have a Sainsbury's near me to check, but I'd be very surprised if that's how it works.
All the major supermarket chains are competing with each other for customer loyalty, to keep them shopping at that chain instead of others. That's why they push loyalty/membership cards so much: exclusive limited time offers and offering perks to customers spending more at their stores is how they maintain a competitive edge. Attempting to trick customers like that is going to destroy brand loyalty as many would notice significant price differences like that. I haven't been able to find which thread you mention, but I wouldn't be surprised if the person making that claim thinks it works like that because they complained to staff about the incorrect price, and the staff then corrected it for them. Just a guess though
I can't wait for an entire series on tax avoidance 🤗
I want the series on fighting Sainsbury's
For that you don't want to subscribe to a mathematician. Subscribe to a Lawyer, they are the ones with jucy storys on tax avoidance (maybe evasion but can you prove it?)
@@TestTestGo Or Jimmy Carr 😆
I think the most important thing we've learned from this video is not to shop at Sainsbury's.
The editing on "10 minutes 20 seconds" was super smooth. I appreciated it.
Sounds like Sainsbury's is engaging in some very dodgy pricing.
I think trading standards need to get involved.
It takes time to change the tickets whereas the prices on the computer are updated immediately. It's likely that they later changed the ticket to the higher price.
@@harrison805 Why are they changing prices on the fly, though, and not before opening or after closing? Barring some kind of emergency, I can't imagine there's any actual need to change prices more than once a day.
@@harrison805 Where I'm from the lowest advertised price is the one that has to be charged, and the store is responsible for ensuring price tags are in date. I would hope it's the same in the UK.
@@-tera-3345 Yes, it should have been done out of opening hours
Years ago I helped write a web-based tool to track employee PTO time and ran into a similar issue because the hours were allocated annually but accrued biweekly. Most systems just divided and tried to track the horrible decimal approximation, then had to have a special "correction" at the end of the year. I just tracked the time in units of 23rds of an hour and it was integers all the way, baby!
Until you try to use your two minutes 36.52173913043478... seconds of leave
@@wasspj Policy didn't allow it to be consumed in less than 1 hour increments.
In case you wonder where "Here in England" is: Between Zurich train station and the National Museum of Switzerland.
7:13 I love how the fun side-fact may be fun to normal people but to mathematicians (or at least people with an understanding of maths) it's literally just mathematics being self-consistent, exactly what you'd expect from mathematics.
could we not just slow the rotation of the earth down to 20 hours and speed up or slow down the annual progression around the sun to +50*7 days= 350 days a year ?
@@highpath4776 Sounds expensive.
I liked the outro that totally wasn't in front of the Landesmuseum in Zürich
As a tax accountant I immediately clicked when I read “tax loophole” 😍😍😍
Truth is, cash from NI gets chucked in a pot along with all other taxes. The pot is then divvied up by the Treasury. The way you've described NI is that of a hypothecated tax. Hypothecated taxation as a policy gets aired now and again but so far, all collected cash goes to the Chancellor. Great video. Funny and informative. Thanks.
I think NI is a hybrid tax, some goes into the general pot but most goes to the National Insurance Fund which is indeed hypothecated for NI benefits including the state pension.
"I promise I'll be spending all your money making videos here in England!"
the next standupmaths video:
"I'm once again here in Antarctica for legitimate maths education purposes and not because I'm running from the HMRC."
The joke there is, that the "here in England" bit was filmed outside the train station in Zurich, Switzerland.
This man could legit gaslight you into believing there are actually 8 days in a week
Well, you see, it all depends on which planet the day is measuring.
Well, the Beatles could.
How are you everywhere
@@asheep7797 oh God it begins
That would be gaslighting. As shown, there are about 7.02 days in a week ( 365.25/52 )
i love that the patreon names are in pounds and pence... and then people with dots in their usernames are in there, sorted alphabetically... the tiny little jokes matt puts in are part of what makes his vids so easy and enjoyable to watch thru to the end. tiny little treats to keep the brain paying attention!
The Sainsburys thing is why I love Tescos scan as you shop, the other day I added something that showed with a clubcard price fo £5 or something on the shelf but the handset reported £6.65 so I took a picture of the shelf and reported it to a staff member who fixed the price on my bill.
I really like to see a follow-up on that price thing. Also Nicole has unintentionally beaten the egg mayo filling. 1.05 is closer to 1.06 than 1.09.
Man Sainsbury's have some thing to answer for, huh?
Sainsbury's are actually so terrible at having the correct prices on. almost every time i see a discounted price on the shelf it isn't discounted when it scans. ofc not worth getting a member of staff over 35p so it goes unnoticed 🙃🙃
Of course, the law of large numbers applies.
Say of 1000 people, 900 let it slide. That's 315 pounds of profit.
I think they are supposed to sell it to you for the shelf price when that happens.
The staff is paid, no matter if they fix the pricing or work stocking the shelves or something. Just be nice about it and don't pressure the person. Keep it professional and you don't have to worry about it.
That's how they get you. It's discounted enough to get you to buy it but not enough to complain once you realize it's not actually discounted. Just a scheme to get you to buy more than you really wanted to.
@@jekanyika Not at all. You can of course complain but they are not obliged to sell it to you at the lower price.
My company in the U.S. switched us from being paid monthly (our annual salary divided by 12) to being paid bi-weekly (our annual salary divided by 26). Yes, we got a 0.34% raise.
I'm paid bi-weekly, just checked my payslip and yep it's annual divided by 26.
I got paid today, if my math is right I'll have a 27 paycheck year in.. 2032.
Not only hits, but around 2.5% in interest, you got more. This is way more imported actually.
Did you check to see if the week to month conversion is updated annually depending on whether it is currently a leap year?
Also, at least in the us, your taxes are based only on your annual income. Any charts showing tax brackets based on monthly or weekly pay are just for estimating. You get a wage statement at the end of the year telling you how much you earned in total for the whole year which is what you use when filing your tax return.
This (the first part) is my main question. The tax brackets are (I assume; it is the case in the US) updated for every tax year, so the weekly-monthly conversion rate should be the correct one *for the current year*. No sense including leap years into your math when the tax bracket only applies to the current non-leap year.
Matt first learned of National Insurance on hit game show _Citation Needed._
Amazing how he ties these all together!
So the real lesson is, watch the cash register while you are being rung up.
As a note, the NI band goes from 12% to 2% at the same income as income tax goes from 20% to 40%, so the total marginal tax rate goes from 32% to 42% (excluding other things like student loans etc.)
at one point they were out of step, and scotland now does things slightly differently. I am sure there is lots of accountant etc lobbying for these kind of changes, as for incomes and income tax there are offsets of expenses that can be applied, which can be more difficult to apply to earnings subject to NI
Doing a UK tax video from Zurich with nice trams, perfect!
Matt Parker. Now with tax benefits.
Nice pfp
Parker benefits
@Elliot Mattley yo nice ace pfp
Friends with tax benefits...
..ok in which paragraph can I deduct how much? I watched every video of him
The last scene in Zurich touch is hillarious :)
The NI was for specific things, but recently (for some definition of recently) it just goes into the general taxation pot out of which everything is paid.
However, by paying NI you get access to benefits (paid from all tax collected).
Appreciating the tax system where I live... everything goes by the year. Makes things a lot simpler. Unbelievable that in the 21st century lawmakers are still clinging to impossible constructs like weeks vs months.
I worked in retail for 35 years. There are 53 weeks in about 14% of the years (for numptys like me).
i made the same point, if you pay day is also the first day of the tax year then it will also be the last and you get a 53rd week every 1 in 7 on average
technically, it shouldn't be 1 extra week in 7 years, it's 5 weeks in 28 years bc. leap years
@@1224chrisng True, but I didn't feel like breaking out the calculator. Fiscal years of 53 weeks happen almost 18% of the time but figuring out that reduces my typing speed from 80wpm to about 20.
There are 53 weeks in none of the years. There may be an extra pay check sometimes because a 53rd week begins in one year and continues into the next, but there are never 53 weeks in a year.
@@1224chrisng but 2000 was a further anomoloy as it was one of the century ones where the leap year didnt happen ?
UK Tax loophole? *Jimmy Carr would like to know your location*
Thanks for the dive into UK taxes & shops, and others with the comments. FR : you must be paid monthly (for decades), you can refuse to pay differences between prices shown/on the ticket, vat have to be included when price shown (and detailed in the soon to be electronic ticket). Oh and for those simple things (wages, banks…) everything is pre-calculated taxes on euros but not extra cents, taxed at the source, return automatic (more complex situations are still declared online and corrected afterwards).
This is crazy. In Norway we pay taxes every month/week, but the amount is just a approximation based on assumed deductions and for the period of time like month/week, since the final taxes are calculated on the annual salary after deductions. Thus our approximations are almost always wrong eg. I have paid too little and need to compensate for that by the 31st if I don't want to pay additional interest, but we would never be taxed differently based on how ofter we are paid. That is just ridiculous 😲 When that said I would assume weekly payments would most likely happen on lower paying jobs so it might be that they save money because they don't hit the second level at all.
This reminds me of what my phone company does when you switch contract midmonth (which is seldom possible but did happen to me):
They work with an annoying "The average month has 30 days" to calculate a daily rate of your old and new contract (without mentioning that's the way they do it) and then apply that to every day of the month. Which I only noticed cause they made me pay 30 days at the old (high) rate and 1 at the new (low) rate, which was very obvious in the total.
The most annoying thing was, that after I sent them a complaint with all the proper working out, their only reaction was to send me back a refund about the difference I had calculated without saying anything to acknowledge my underlying complaint
Trying to work out if he said "a standard leap year has 365 days..." instead of 'a standard year...' on purpose for comments like this.
Thought that was what I'd heard, but didn't bother going back to check.
It was a mistake, not on purpose. At that point in the video you can see a textbubble with a link to corrections appear in the top right corner.
I think he meant a Parker Leap Year
Sometimes I think he makes errors deliberately to make math more "relatable".
Another thing that's quite interesting here is that not only is there a discrepancy *on average*, there is also a realised discrepancy each year for weekly-paid employees. Since payments are made at discrete points in time, monthly-paid employees will always be paid the same amount year-on-year (provided their annual income doesn't change), because the financial year is precisely 12 months.
However, weekly-paid employees will see 52 payments and *sometimes* 53 payments in a year, since financial years are not divisible by weeks. The remainder in the average-weeks-per-year calculation is actually felt by weekly-paid employees as an increased tax burden in 5 years every 28-year cycle. This is because the sequence (1, 1, 1, 2), representing the remainder of (# of days in year)/7 sums to 5, which is coprime to 7, hence it requires 7 cycles of the sequence to return to its starting point. This means there are 5 weeks (5*7 days) sprinkled among 28 years each cycle where the weekly-paid employee observes 53 payments squarely within the financial year, resulting in an increased tax burden.
It is also then, no surprise, that 5/28 is exactly the remainder of 365.25/7.
tl;dr: if you are risk-averse and like certainty, get paid monthly!
I used to work in IT for a bank (I'm not going to say which one). The interest calculations assumed 365 days a year, which meant that during leap years the calculations were slightly wrong. I remember once someone once writing in with a detailed calculation showing the difference.
Just had an ad for that bank.
Things I was meant to learn from this video: Week rounding via earths rotation and tax brackets.
Things I did learn: Sainsbury's will probably rip me off.
Yes, as a mathematician stuck filing the family taxes I also found myself desperate for something more fun to think about.
Matt: Here's a quirk of UK tax law.
Comments: Yo, WTF Sainsbury's?
3:15 made me wake my wife up from laughing so hard lol
11:20 - Hi, Alex! Hi, Nicole!
I sent this video to all the people that I know in the UK Congress.
Supermarkets always do this in the UK.
It's really bad when you do a big shop, and there's no way I'm taking it all back.
Hey Matt, not sure if this is addressed by using decimal number of weeks in the year, but if you are paid weekly on an annual salary, every 5-6 years there will be 53 pay periods in the year. Generally your paychecks for that year would be the annual salary divided by 53 instead of 52. I don't know really if this makes a difference based on your calculations or not.
I spent a lot of time thinking about this because one year recently at my job being paid fortnightly, we had 27 pay periods in the year instead of 26. It sent me down a deep rabbit hole of understanding where that came from and how often it happened.
the fraction 4.3482 weeks/month or 52.1786 weeks/year already is an average that takes in consideration what you are describing. The fraction tells you that every 28 years, there is going to be 5 years of 53 weeks and 23 years of 52 weeks.
The monthly and weekly bands are actually based on the annual figure scaled down, 12570/52 or 12570/12 then rounded up. They base it on 52 because they just count the number of payments made at the end of each week. However some years you will get a 53rd payment and will be a lot better off as you get an extra £242 NIC free. (You can also get paid fortnightly or 4 weekly and get either a 27th or 13th such payment respectively covered by the allowance).
You can make sure you get that extra payment every year by always starting a new weekly paid job 6 days before the end of the previous tax year.
My salary in germany is calculated the following way: monthly salary = hourly rate x hours per week x 4.348. Now I know why, thanks Matt
Imagine being the cashier and seeing egg mayo, a Mango, a candle and a small chocolate bunny.
Average Friday night in the U.K.
Grapefruit =/= Mango.
Imagine being in a supermarket and still seeing a cashier in the UK.
If you were in Canada and bought two of those 50p chocolate Easter bunnies you could get the first one free and the second one at 50p instead of paying 60p each. It's called the "Scanning Code of Practice" in which stores voluntarily give up to 10 dollars off for any item priced lower on the shelf than scans at the checkout and if you want more than one you're entitled to additional items for the lower price. It's our way of paying the customer for doing a job for us. Electronic RF pricing labels is making this job easier.
It’s voluntary so Only at participating retailers but that is most of the big ones.
We have a different policy in the UK. What happens is you press the help button, then the checkout supervisor comes and looks at what you're buying, assumes it was a weight issue and clears the message and walks away without saying anything, then you need to call after them and explain the issue, then they roll their eyes at you, cancel the item and scan it again for you and read you the price that came up, then you need to tell them it was something else on the shelf, then they read you that the price coming up on the scan again, then you say "I'll go and check the price" and you go and check then come back, then you have to find where they've gone and tell them you were right, then they call on the walkie-talkie for someone to go and have a look at the shelf, then...
@@charliedobbie8916 and finally, the shelve price is an innovation to offer to make transaction "anyway", meaning they do not even have to give the item at the advertised price.
In Norway, the standard practice is that you get to buy the thing at the sticker price (within reason; no one is selling a kilogramme of cheese for 1 p). It's not strictly required by law, but exceptions from this are very uncommon, particularly in food stores.
@@charliedobbie8916 in Germany we have electric price sign synced with the register so everything is pretty much labeled correctly in supermarkets
I've always thought that the whole point of NI is to be so opaque that very few people can work out what the real taxation rate is in the UK.
LIDL also suffer from lots of incorrect pricing on their shelves.
Another interesting calendar system is used in the US by CSRS/FERS. Presumably in order to more easily calculate the time between two dates by hand, every month is calculated as if it had exactly 30 days. The 31st day of a month becomes the 30th, and the last day of February (either the 28th or 29th depending on the year) also becomes the 30th. After making those adjustments to the day, you can just subtract the dates to get the number of years, months, and days between them. This is specified in the CSRS/FERS Handbook C050.
6:22
Well ackchyually Earth orbits sun in 365.256... days (Its Siderelar year). But because of Earth's precession the plane of equator is shifting (relative to the stars) so every 365.242... days (tropical year) Sun is in the same position relative to equator, which determines the seasons so it is type of year, calendars are synced with.
I'm fine with paying NI, but paying "an eye" (as the subtitles sometimes rendered it) is a little much
I'm surprised that people are only just realising this happens, it's been happening for as many years as I can remember in the UK at least.
Morrisons errors are usually in your favour.
Tescos rarely ever makes any pricing errors like this.
Asda only makes 'errors' that are bad for you.
Sainsburys, well just watch the video.
Most supermarkets in the UK don't show the correct line price on the receipt for sale items, instead moving the discount to a 'you saved' line. I had this issue today in Morrisons on a £!2 food scale marked at £9. It rang up as £12, then added a line £3 discount. I was charged the correct price. Sainsburys I shopped in a few days ago and a lot of the shelf prices stated Your Nectar Price - so you need to scan a nectar card or use your phone app to scan and go. before we organise the pitch forks, maybe just check your own receipts fully. Mistakes happen, and it's normally through incompetence rather than some evil conspiracy.
The spiffing Brit will be reaching out to Matt shortly
Happy stay in Zurich, Switzerland, Matt XD
Interesting. In retail we use 'Quad Weeks' for finance - either 4 or 5 weeks for a given accounting period (4 4 5 or 4 5 4). I think this is mostly done to align the ending days and requires a year with 53 weeks occasionally.
When I was doing reporting in retail we also did that so that our promotional weeks would align. We had years of 364 days so they would shift a bit but aligning on the right day of the week was more important. If you wanted the equivalent day last year you went back 364 not 365 so you got the same day of the week.
I hope there's a follow up video explaining why the tax year runs from April 6th to April 5th in the first place - relating to the changing of the calendars back in 1751 to 1752!
Have you ever heard of a leap pay? Every 10ish years my employer decides take away one paycheck because of... too many Thursdays. It seems like a scam but none of my co-workers could work out the maths, which is sad because many of them are math teachers. The school board's logic is that we are paid an annual salary on a bi-weekly basis. So every other Thursday we get 1/26 of our salary. Because days in a year and weeks in a year don't match up, over time things get unbalanced. Some pay years start and end on a Thursdays. Their answer to this is to skip a whole 2 week pay once every decade or so. I don't see how this actually evens out as our salary changes year to year as we move up the pay scale. My pay missed in year 9 might be almost double what my pay was in my first year. Also, some one starting in a "leap pay" year will lose a pay their first year, while some one who starts after and works for 9 years may avoid it all together. It doesn't help that the fiscal year is not the same as the scholastic year and raises start somewhere in the middle. So you can't just say, "in 2022 my salary was ****** and my actual income was ******. Anyway, everything was super unclear and I really think we might be getting duped because no one wants to sit down and do the maths. Maybe a question for #APS😂
The quirk in the US tax system I found myself on the wrong side of this time around: We have tax bands (brackets) the same as the UK does, but for some reason the IRS decided that Americans aren’t very good at math and so instructs everyone under a certain income limit to use a table to look up their tax instead of just calculating it. The thing is, that table goes in increments of 50, so if you’re in the unlucky 2% whose incomes are a multiple of 50, you can end up paying a 600% or 1,100% marginal rate on your last dollar!
This year they just instructed everyone earning over $100,000 to use a formula instead of printing out tax tables that high so the errors only happen to people or couples filing jointly who earn under $100,000
@@p5ychop3nguin Tax tables have never gone beyond 105, that's standard.
When I was younger and tight on money I would go through the supermarket putting everything I would buy into a spreadsheet in order not to overspend. Almost every time the total would be different, and I would check the prices one-by-one. Sometimes I made a mistake, and sometimes the supermarket made a mistake. They said it was because the price would update in the system but they hadn't updated it on the shelf yet.
What I think is curious is that not even once the charged price was less than what was written. Every single time it was more. "Honest mistake", I guess.
I would always get the difference back, but I wonder how much extra money they make by charging every customer a bit extra.
Also, once I bought like a few grams of something and they charged me as if I had bought 1 kg, but this one I think was really an honest mistake.
5:55 best explanation of how many days are actually in a year that I've ever seen. Good job
The spaghetti hoops are from Sainsbury's budget brand and 16-19p a tin is the typical price range for a 400g tin ofsuper budget spaghetti hoops at the moment. I'm sure the trading standards office from the area that Sainsburys' store is in would like to see your receipt and the video of the shelf price flashes
What? The ending is in Zürich! I take that tram line 4 to ETH all the time!
When we worked software in radio we had very special calculations for 51/52/53 weeks of a particular year - as all the billing was by the week of the year. Including the 100/400 year rules. They used to do that manually, which left a lot of variation as you can imagine.
The voice over on the 10 minutes 20 seconds... Perfect. LOL love your videos keep it up.
It's tax fraudin time
Looks like the tags on the grocery store shelves are as inaccurate in the UK as they can be in the US
US tags are always inaccurate, they don't include VAT.
@@Soken50 Do you mean sales tax? No VAT in US. Lately with the ripoff inflation at grocery stores in the US, the prices go up in the computer faster than they can keep up with on the tags, so inaccuracies (in the store's favor) are more common.
@@zzzaphod8507 Same difference, you're not paying the tag price.
@@Soken50 Solved in Turkey by requiring price change dates to be listed in the price tags, meaning a curious customer can record the price tags over time and compare the prices since the last change.
@@erkinalp Solved in France by requiring stores to display checkout prices and selling at display price if there is conflict between the two.
When I worked for the DWP (benefits office) we were told to use 4⅓ weeks in a month, or the idea of 13 weeks in an annual quarter. Frankly, enough people had difficulty with the idea that there weren't actually 4 weeks in a month anyway, so it must have been to simplify everything.
I don't know the real reason HMRC use a simpler number rather than an accurate one, but one hypothesis is that this is simply a habit formed many decades ago in the traditions of accounting, before computers did everything - no longer really needed, but these things tend to have momentum, in that people just use them because "it's always been done that way". The fact that it's now trivial to calculate it correctly in software doesn't enter into the decision!
I wanted to see you go back to the store & confront them about the prices.
Now I wanna find a way to buffer overflow HM Treasury 😃
Assuming they're using a 32-bit architecture, you just need to earn over £4,772,210,000.00 to roll-over to paying nothing! Simple!
@@jeffsergeant so _that’s_ why billionaires don’t get taxed properly! It all makes sense now.
I wasn’t aware of a Sainsbury’s branch in Zurich. Well done for finding it.
I haven’t watched the video but it’s also looked at on an annual basis by Hmrc and adjusted accordingly. Also some tax years have 53 weeks in them. It’s calculated based on what date your actual pay day falls on.
I definitely want more tax videos
You are performing a great community service by exposing this, and I wish you all the best for the upcoming audit.
5:55 "A standard leap year has 365 days except if it doesn't, then it has 366 in a leap year."
As someone who has a lot of experience working for a grocery chain where I was heavily involved with pricing and signage... this is the kind of thing that happens when the person who swaps the signage and labels over for the weekly ad-change calls in sick. Happens all the time.