A bathroom renovation in an investment property may create capital works deductions and sometimes depreciating asset deductions. The treatment depends on the type of works, timing, asset split and whether the property is income-producing.
Bathroom renovations often include:
Tiling
Waterproofing
Plumbing
Electrical
Vanity
Shower screen
Toilet
Tapware
Exhaust fan
Lighting
Cabinetry
Structural changes
Some items may be capital works. Others may be depreciating assets.
If the bathroom replaces an older bathroom, there may also be scrapping opportunities for removed items if documented.
The timing matters. Works done before the property is first rented may be treated differently from repairs during tenancy.