I am current working at a full time position earning a 50-90k If I work as a contractor and earn 10k as a sole trader I am only required to pay tax on that money at EFY. If I invest the 10k in an ETF or Managed fund which reinvests the dividends, am I required to pay tax on the 10k still? Or is it counted as an expense to my business? Or Is it when I withdraw the funds from my shares that I will pay tax in the financial year that I withdraw?
Also, does it make my total taxable income appear less? Or is my total taxable income independent of whether I buy shares with it? does the government see me as earning 50k-90k + 10k?
I would really appreciate some clarity on this. Thanks.