buckworks - 5:52 pm on Dec 10, 2012 (gmt 0)

At that income level it would probably be considered a hobby rather than a business. The net income is likely quite a bit less than zero once related expenses are taken into account.

However, if your intent going forward is to turn this into a proper business, it would be good to take the most business-like approach now, and declare both the income and expenses.

If your country is like mine, you wouldn't be allowed to claim a loss, but you'd have no trouble getting the net income down to zero once costs such as domain registration, hosting, internet connection, etc. are deducted.

Going forward, be sure to keep a good paper trail to document all related expenses (including home office costs) so that as your business grows, you can claim every deduction you're entitled to.