What is a Business?
According to Canadian Courts a business should not have any personal element in it. It is a venture you operate with intentions of generating income and profit. A business will usually have many transactions therefore income generated will qualify as business income.
Generally you are allowed losses if your business is not successful. However, if there are no expectations of profit according to CRA, you will not be allowed losses.
Usually one transaction business will yield a capital gain / loss but not a business income.
Business plans are extremely important and one must look and revise business plans periodically.
Businesses can often make losses. Always report all legitimate business expenses and save supporting documents to justify losses.
Expenses made before starting business are often non deductible.