You would be able to claim a deduction for the interest expense in relation to money borrowed for the purchase of shares but only during the period/s in which it is expected that you will derive an income.  Once the shares were sold, it is quite clear that your original loan to purchase the shares changed its character and is now essentially for private purposes. As you no longer derive an income after the sale, then you are not entitled to claim any interest as a tax deduction. If, however, you had elected to re-invest the proceeds into another income-producing investment then the character of the loan would not have been in question and deductibility of the interest would have been intact til such time that you no longer reasonably expect to derive an assessable income.