If I am currently paying a finance lease for a vehicle and then subsequently decide to request a settlement figure from the bank and pay the remainder of the finance debt off to the bank can I claim the lump sum settlement as a deduction for tax purposes?
You can only claim vehicle expenses if you receive a travel allowance or are self-employed and you use the vehicle for business purposes. Either way, only the interest portion of the lease payments are claimable as a deduction. Therefore the interest portion of the lumpsum settlement could be claimed as a deduction.
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