Calculating Tithes Properly

A tithe is a tenth. The tenth part of your income. It is ten percent of your income. You don’t owe God any tithes until he has given you a blessing in form of an income, a gift, wage earning, salary, commission, profit, produce from your farm or any other blessing he brings your way.

Abraham paid tithes on all the spoils from the battle field.

“And Melchizedek king of Salem brought forth bread and wine: and he was the priest of the most high God. And he blessed him, and said, Blessed be Abram of the most high God, possessor of heaven and earth: And blessed be the most high God, which hath delivered thine enemies into thy hand. And he gave him tithes of all.” (Genesis 14:18 -20)

This account is also repeated in the book of Hebrews.

For this Melchisedec, king of Salem, priest of the most high God, who met Abraham returning from the slaughter of the kings, and blessed him; To whom also Abraham gave a tenth part of all; first being by interpretation King of righteousness, and after that also King of Salem, which is, King of peace; (Hebrews 7:1-2)

Jacob entered into a covenant with God at Bethel that if he was blessed, he would give the tenth of all.

And Jacob rose up early in the morning, and took the stone that he had put for his pillows, and set it up for a pillar, and poured oil upon the top of it. And he called the name of that place Bethel: but the name of that city was called Luz at the first. And Jacob vowed a vow, saying, If God will be with me, and will keep me in this way that I go, and will give me bread to eat, and raiment to put on, So that I come again to my father's house in peace; then shall the LORD be my God: And this stone, which I have set for a pillar, shall be God's house: and of all that thou shalt give me I will surely give the tenth unto thee. (Genesis 28:18 – 22)

It was only when his blessing came, that he would pay tithe. You cannot pay tithe on what you do not have. No one is able to give what he does not have.

Payment of tithe covers everything that you can classify as an income or a blessing from the Lord. If you are employed and you earn a monthly salary, you owe God the tenth of your salary. If in addition to your regular employment you run a private commercial business in the evening after work, you owe God Tithes on the income from this additional business which is an additional blessing. You also pay tithe on the gifts you receive.

Knowing how to calculate your tithes is therefore important. I recognize that it is not always easy to calculate a tenth on every blessing. There are some blessings God will expect us to use our heart not our mind to calculate the tithe. For instant if your child gets a gift of a toy from a friend. You use your heart to calculate what you would give to God as tithe to keep the flow of these sorts of gifts coming.

The words of Jesus in the book of Matthew 23:23 clearly demonstrate that tithing need to be done from the heart.

Woe unto you, scribes and Pharisees, hypocrites! for ye pay tithe of mint and anise and cummin, and have omitted the weightier matters of the law, judgment, mercy, and faith: these ought ye to have done, and not to leave the other undone.(Matthew 23:23)

Calculation Methods

Let us now examine in details how tithes ought to be calculated for various classes of people by applying simple examples. I have intentionally left out the currency since this will vary from one nation to another. However, the principles remain the same.

(a) Employed people

Basic Salary                   -        10,000

Housing Allowance        -           2,000

Transport Allowance     -           1,500

13,500

Deductions

1.     TAX (P.A.Y.E)- 30% of basic salary

2.     National Social Security Fund – 200

3.     Cooperative Society (SACCO) – 1,000

4.     Loan Repayment – 1,500

Note: this is just an example. Taxation depends on governments fiscal policies which vary from one nation to another, while other items quoted may be optional in most cases.

From the above figures, the actual cash payment to this employee at the end of the month will be:

Basic                                                 -        10,000
Housing Allowance                 -        2,000
Transport Allowance              -        1,500

Gross Pay                               -        13,500

Less
P.A.Y.E. (30% of Basic Salary)       -        3,000
National Social Security Fund -        200

Cooperative Society                -        1,000

Loan Repayment                     -        1,500
Total Deductions                              -        5,700

Net Salary Paid                      -        7,800

Even though on paper this person has a total pay packet of 13,500, the actual take home is 7,800.

I recommend paying tithe on your actual take home amount. This is because  this is what you have control over. So using our case above, the tithe payable is ten percent (10%) of 7,800. The tithe will thus be 780

However I will hasten to add here that if you prefer doing it this way, then it will be important for you to pay tithes on the benefits you draw from your cooperative society, National Social Security Fund and the loans you get.

The other common applicable approach is to pay tithe from your gross pay less government taxes which in our case is can be calculated as follows:

Gross Salary                           -13,500

Less

P.A.Y.E                                  -3,000

National Social Security Fund -200

Net Amount to tithe on          -10,300

Tithe to be ten percent (10%) of 10,300 which is equal to 1,030. This approach will then exempt you from paying tithe on loans and other refunds you draw from cooperative society etc.

P.A.Y.E and National Social Security Fund deductions are statutory government deductions that are deducted at the source by the employer and the employee has no control over that. In some countries or states we may have other additional statutory deductions.

Cooperative deductions and loan repayment deductions are all private arrangements. They are not statutory or mandatory. The deductions are made because the worker chose to enjoy those facilities. So those deductions should be considered as monies received and then returned back voluntarily.

(b) Self Employed Business People

Self employed and business people should start by establishing a trading cycle. This means they should know when they start a season or period of trading and when they complete it. A good example is closing accounts every end month to see profits made or analyzing a contract after completion to confirm profits made. Then tithe should be based on the net profit realized not on the investment. Notice that net profit is calculated by removing expenses from the gross profit.

Take the following example for better understanding.

If you buy a product at 10,000 and sell it at 15,000, you have made gross profit of 5,000. But this is not your net profit since you must have incurred other costs in selling the item. Let us take for instance that you spent 300 to advertise the item in the local news paper, 200 to repackage the item and, 1000 to transport the item to the buyer.

The net profit will be worked as follows:

Sale value             -15,000

Less
Purchase Price      -10,000
Advertising           -300
Repackaging         -200

Transport             -1,000
Total Cost            -11,500

Net profit = Sale minus total cost = 15,000 – 11,500 = 3,500

The net profit is 3,500 which should be the basis of calculating your tithe. The payable tithe in this instance is ten percent of 3,500 which is 350

We pay tithe with joy and love and therefore the above calculations should not make paying tithe look like a punishment. The Holy Spirit will teach you and guide you on how to calculate your tithe with ease.