A hot water tank heats and holds the hot water for the home. This water is separate to the heating system and will be used for bathing and hand-washing - appliances like dishwasher or washing machine heat their own water.
Hot water tanks are well-insulated, normally quite large and live in a dedicated cupboard, or sometimes attic space. When the tank is instructed to, usually on a timer, it will heat the water within it to a requested temperature using an electrical heating element. Some modern tanks are smart (including mixergy) and heat the water in sections of the tank for maximum efficiency.