Bitcoin works same like other online money systems, but in bitcoin the transactions are encrypted and you are safe with all kind of taxes like what u are paying in your nation just because Bitcoin is not under any Authority.
Bitcoin wallets can send and recieve bitcoins from other users, same like what u have saw in paypal/payza etc. You can buy/sell products accept bitcoin. This ledger contains every transaction ever processed, allowing a user's computer to verify the validity of each transaction. The authenticity of each transaction is protected by digital signatures corresponding to the sending addresses, allowing all users to have full control over sending bitcoins from their own Bitcoin addresses. In addition, anyone can process transactions using the computing power of specialized hardware and earn a reward in bitcoins for this service. This is often called "mining".
