When declaring my income for council tax benefit, can I deduct my business expenses first?

whatever you put theyre going to want proof of anyway, they will want accounts, bank statements , tax credits award notice

Yes you should deduct your expenses first, because those are not really your income. As long as they aren't optional expenses that benefit your personal life but you try to sneak onto your business, and they are legitimately needed to keep the business running then they won't try to class them as your own personal finances.

If you are self-employed and anyone asks about your income, it is your net profit / taxable income that they are asking about.

In the context of council tax benefit you will need to show proper accounts to prove this.

Income is always what you get in the end. So income from a councils point of view is the same as HMRC's net income.

Sales minus costs = income.

I think there will be strict guidelines on this. Read the guidelines or go online and look through the FAQs. I would have thought they want your net profits from the business, but check the guidelines.