Tithing from Income

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Question

Hello, My name is Menashe, and I am reaching out with a halachic question regarding the calculation of tithing. I am the owner of a limited company, from which I draw a monthly salary of 6,000 NIS net. Additionally, I issue an invoice as a self-employed individual to the same company for 10,000 NIS net per month. I would like to know how to correctly calculate the tithe in my situation — should the tithe be calculated from all the mentioned amounts (a total of 16,000 NIS), or should certain expenses be deducted from them? Additionally, since some of my personal expenses (such as food, car, rent, etc.) are paid directly from the company's bank account, should these expenses be deducted from the amount from which the tithe is calculated? If so, which expenses should be deducted and which should not? I would appreciate precise guidance on how to proceed in such a case, to give the tithe correctly and accurately according to halacha. Thank you very much in advance for your time and assistance.

Answer

Hello 

Tithing is calculated from the 'net' profit, not the 'gross'. 

Therefore, when an employee has expenses related to their work, such as fuel for travel, etc., there is no need to pay tithes on these, even though the money came as a total sum. 

In your case, I understand that the business expenses are paid from the business account itself, so the salary you draw is 'net' profit. Therefore, you should pay tithes from the entire amount. 

Additionally, personal expenses paid from the company's account, such as food, etc., are also considered net profit, because this is essentially a way you are drawing profits from the company's account. [Although legally this amount is considered an expense deduction, in practice, since you are the business owner, and the company is yours, you are essentially drawing profit from the company's funds].

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