I would like to use a Softpot as a dimmer switch, to do this I think I need to use arduino to read the values from the Softpot to then tell the Led what voltage/brightness is required. The Softpot only triggers the Led when touched. Does anyone know what kind of code I might need to use, and or do I need to add a component?
Well, you need to feed the potentiometer output into analog input on the Arduino and use a function to read the voltage. You need to "debounce" that reading so that when you take your finger off, it detects the sudden change to an essentially zero value (add a resistor to the ground end of the pot so that its value when touched is never zero, and a 1M or so resistor from the wiper to ground so that it is zero when released) and retains the touched reading.
The second section of the code is to use the last valid brightness value to control PWM on the LED.