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Ruling 1790

A person who has a number of lines of business – for example, with his capital he has bought [and trades in] sugar and rice – in the event that all the lines of his business are the same in business matters such as income and outcome, book keeping, and profit and loss, he must pay khums on the amount that exceeds his living expenses for one year. In the event that he gains profit from one line and a loss from another, he can offset the loss from that line with the profit from the other. However, if he has two different lines of business – for example, he trades as well as farms – or, if he has one line of business but the profit and loss are calculated separately from each other, then in these two cases, he cannot, based on obligatory precaution, offset the loss of one with the profit of the other.