Of course. Put money in a savings account, and 20% income tax is automatically taken off the interest. If you are investing in company shares, income tax is taken from the dividends before you get them. If your other income puts you into higher rate income tax, there will be more to pay on the dividends.

That leaves us with capital gains tax on selling stocks or shares at a profit, but the annual exempt amount for that is so high that it is unlikely to affect you unlike you are incredibly rich.

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First thing is that you not have not mentioned where you invest your money,

because in some scheme it is Taxable while in others non taxable,

1) The interest from PPF is tax free

2) FD interest is not tax free,

endowment Insurance policies are not taxable,

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Usually. But.... Municipal bonds might be tax-exempt. Gains within a 401(k) or an IRA are taxed, but not until you withdraw them from the account.

other exceptions exist.

Yes you have to report it! Your broker will send you a form at the end of the year to give to your tax person to make it easier.

I'm new to this whole investing thing.

Is money you earn from investments taxed? Is it taxed if you used your investment returns as a source of income? Is it taxed if you re - invest it?