For income tax purposes, a business is an activity that you intend to carry on for profit and there is evidence to support that intention.
A business includes:
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- a profession;
- a calling;
- a trade;
- a manufacture;
- an undertaking of any kind; and
- an adventure or concern in the nature of trade
The three most common types of business structures are:
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- sole proprietorship;
- partnership; and
- corporation
The type of structure you choose has a significant effect on the way you report your income, the type of returns you file each year, and many other matters.