3 reasons why I started a business in Edmonton

I run an AI-powered Accounting firm based in Edmonton. Conventional accounting is almost always WRONG, inefficient, and drastically holds you back. Taxes, payroll, and housing are the only 3 costs that matter. Failing to optimize those will hurt your finances. If you use mainstream accounting, you should not be surprised if you waste the best time to be alive, having to work forever with almost no chance of recovery. If their service worked, everyone would be well off and rich. You do the math. Please reach out to us at help@christianthut.com

1. #1 lowest small business taxes in the developed world

Combined, the corporate and personal taxes in Alberta amount to only 14% of earnings for $300,000 in income (compared to 20% in Switzerland). In Alberta, you can earn more than $20,000 per month after-taxes and become a multi-millionaire within a short time. Making more money has a bigger impact on your financials than reducing your spending since there is a ceiling to cutting costs, you can not go below 0 while there is no ceiling to earning.

2. Low-cost Housing vs Zug, Switzerland (#2 lowest tax), Vancouver, Toronto

Until you have the cash to optimize your taxes and your mortgage interest you should be keeping your cash flow down by renting. It is a common mistake to think that buying a house saves you money. Buying an asset with debt is merely renting money you don’t have.  In addition to the interest, buying a house has more costs:  property taxes, home maintenance, repairs, upgrades.  A $700,000 house can be rented for $2,550 CAD, so the price-to-rent (P/R ratio) is 23 (700k/ (2550*12)). You should only buy if the P/R ratio is less than 15  unless you are optimizing your opportunity cost of other assets (a scalable business).  Focus on delivering value, and you’ll see the priorities in building a scalable business since real estate does not normally add comparable value except in gentrification during times of shortage.

3. High Diversity, Inequality, Complexity 

Diversity is the raw material of natural selection and pushes evolution forward since inequality is not only natural & inborn, it grows with the complexity of civilization. Compounding inequalities can give you 3x+ after-tax earnings of the median household.

Canada is developed enough to avoid stress from real problems like feeding yourself, while still raw enough that it is not too structured, too perfect and too developed like Switzerland.

In Canada, we are forced to listen to what people from around the world have to teach us about the new world.  Asian management is all about doing- not about planning. Living in places like Vietnam have made clients better at living with insecurity and therefore better at embracing risk.

1 Thing Switzerland does better than Canada

In Canada, we have a system where the cost of health care is built into our taxes and dependant on our income and not on our risk optimization like in Switzerland.

In Switzerland, you can pay out of pocket for everything under your deductible. Costs above your deductible are taken care of by your insurance policy to which you pay a monthly premium.  You can reduce your monthly premiums by reducing your deductible.  The Swiss system is more sustainable since there is less asymmetry (where the largest cost to the Canadian health care system is also the smallest contributor).

If you want to maximize your life, you might like:

  • How much taxes should I expect to pay?  The latest audit initiative by the CRA has sent a panic through the population. How much taxes should I expect to pay? You can optimize your 2 biggest expenses: taxes and housing by balancing your draws from your corporation Once you have a business you love (1st) and a home that you love (2nd since […]
  • Part 2: Get Big, Stay Lean: A How-To Guide For Clean Bulkers  Before looking to grow you need to get lean first.  Once you have downsized until the marginal costs of outsourcing exceed the cost of doing it internally, you are ready to get big. Contrary to popular belief, you can get big without becoming inefficient. Here’s how to get the best results from your bulking plan! Spend more! Most people focus […]
  • Part 1: Get Lean before Bulking  What happened to THUT? At its height, we employed 6. Today, with more and larger customers, there is only 1 employee.  In order to grow, older companies (4+ years) need to get lean first: downsize until the marginal costs of outsourcing exceed the cost of doing it internally. Staying lean is key to operational efficiency.  For […]
  • Scale, Derivatives & the Most Important Ratios  Since we have agreed that math is the key to escape the middle class, we must go further to how to apply math in your business. Everything operates on first and second derivatives, marginal effects, and ratios. Algorithms are the key to scale: Find a problem that you can address that will bring value to customers. Re-frame […]
  • Math to Escape the Middle Class  Being part of a certain profession, or earning a certain amount of money does not ensure your exit from the middle-class.  Most people are stuck there because of math. We focus on the only 3 sources of negative cash flow that matter: taxes, housing and in the case of a scalable business – payroll.  Even […]
  • Investing Philosophy Updated for 2018  For the past 10 years, I was a strong proponent of dollar cost averaging. But our bull market will come to an end in this 4th turning.  What else can you expect: an increase in your mortgage payment due to rising interest rates; global equities will be down 20-40% from the maxima Alberta real estate […]
  • Man’s best friend: Dog Not Wolf (Employees vs contractors)  “If one holds his state based on mercenaries, he will be neither secure nor peaceful; for they are divided, disloyal, ambitious and without discipline… they have neither fear of God nor are loyal to fellow men.” – Niccolò Machiavelli Substitute state with company and mercenaries with contractors as you see that there is a misalignment of […]
  • ChatBots for Mass Market Businesses  Keeping true to our focus on minimizing payroll costs, Blockchain-enabled AI Bots are more cost-efficient than employees, available 24/7, have a quicker response time and will result in more sales. By using blockchain technology there will be a ledger of each customer’s conversation with the ChatBot in the event there is a problem. Online product sales: Chatbots should […]
  • Customer is King  The most important things in valuing a business are detailed financial records, well-documented operations (SOPs) and customer metrics: the long-term value of the customer, the cost of acquiring customers, revenue, and lost customers. Last week a dozen of our customers were listed as 2018 Golden Fork winners so we will start with the fast food group: Customers […]
  • Alberta versus BC  Many clients tell us they plan to move BC because of the warmer weather but there are some things that they should keep in mind. Although Alberta and BC have equal small business corporate tax rates of 12%,  Alberta is still the rational choice for your headquarters. Alberta’s differences over BC: Higher GDP with an economy […]
  • Math Hacks for Your Business  Location Due to mathematical clustering and conformity, the closer you are to your highest-grossing competitor, the more likely it is you will get half their customers upon opening. If you follow the rest of the advice in this blog and have multiple sources of income, to begin with, you ride out the zero-sum game until you […]
  • Running a Nail Salon  What are the three most important performance metrics? The lifetime value of a customer is king, and the three things that drive it at salons are client retention technician retention and retail sales per client. Client retention. Repeat customers generate a higher return on every dollar spent getting them in the door. Having a client […]
  • Lifestyle design for 2018 and beyond  There is too much choice and we all suffer decision fatigue. The start of the year is a good time to plan out the rest of the year. Life is too short to spend time shopping – shop as little as possible and have your necessities automatically delivered to you in a biweekly shipment. Likewise, […]
  • How Does Your Income Stack Up?  Do you know how well you’re doing income-wise? Many of us have no accurate idea because we don’t know how much our peers earn. While constantly comparing yourself to others may lead to unhappiness, you should know where you stand because it dictates your strategy going forward. If you don’t know where you are today, […]
  • Top 2 Profitable Purchases of 2017  2017 isn’t over yet but I guarantee that nothing else I buy in the next 3 months could surpass these 2 products. Read on if you want to: save time for what’s REALLY important save energy maximize your productivity and efficiency BACKGROUND I have two kids, a 3 year old and 5 year old, which […]
  • Choosing Your Market & Pricing  There are only two markets you need to know: The top 20% (controls 70% of Alberta’s wealth) Average women Where is the average men? They simply don’t count in Alberta– their women control their money -so unless you are targetting the high-end market direct your efforts directly to women! How do you pick your market? […]
  • 5 Rules To Keep Your House From Being A Bad Investment  If the housing market has a positive outlook you can consider a home less than 2.5x your gross annual household income if you make a 20% down payment.  If you can make a down payment of at least 30% you could consider a home that costs up to 4x your gross annual household income. Consider […]