diff --git a/src/Layers/BE/BaseApp/Finance/VAT/Reporting/VATStatementLine.Table.al b/src/Layers/BE/BaseApp/Finance/VAT/Reporting/VATStatementLine.Table.al
index 1591e538451..b86e04530bd 100644
--- a/src/Layers/BE/BaseApp/Finance/VAT/Reporting/VATStatementLine.Table.al
+++ b/src/Layers/BE/BaseApp/Finance/VAT/Reporting/VATStatementLine.Table.al
@@ -146,7 +146,7 @@ table 256 "VAT Statement Line"
 
             trigger OnValidate()
             begin
-                if "Amount Type" <> "Amount Type"::Amount then
+                if not ("Amount Type" in ["Amount Type"::Amount, "Amount Type"::Base]) then
                     "Incl. Non Deductible VAT" := false;
             end;
         }
diff --git a/src/Layers/BE/Tests/Local/VATReportsBE.Codeunit.al b/src/Layers/BE/Tests/Local/VATReportsBE.Codeunit.al
index 8865d545b08..ebfaa26ad03 100644
--- a/src/Layers/BE/Tests/Local/VATReportsBE.Codeunit.al
+++ b/src/Layers/BE/Tests/Local/VATReportsBE.Codeunit.al
@@ -550,8 +550,9 @@ codeunit 144010 "VAT Reports BE"
         // [SCENARIO 379117] User should be able to use "Incl. Non Deductible VAT" for VAT Settlement rows with "Amount Type" Base
 
         Initialize();
-        VATStatementLine."Amount Type" := VATStatementLine."Amount Type"::Base;
+        VATStatementLine.Validate("Amount Type", VATStatementLine."Amount Type"::Amount);
         VATStatementLine.Validate("Incl. Non Deductible VAT", true);
+        VATStatementLine.Validate("Amount Type", VATStatementLine."Amount Type"::Base);
         VATStatementLine.TestField("Incl. Non Deductible VAT", true);
     end;
 
@@ -688,6 +689,20 @@ codeunit 144010 "VAT Reports BE"
         Assert.IsTrue(FILE.Exists(FileName), StrSubstNo('%1 %2', FileName, NotFoundMsg));
     end;
 
+    [Test]
+    procedure InclNonDeductibleVATClearedForNotAllowedAmountType()
+    var
+        VATStatementLine: Record "VAT Statement Line";
+    begin
+        // [SCENARIO 656742] "Incl. Non Deductible VAT" is cleared when "Amount Type" is changed to an unsupported type
+
+        Initialize();
+        VATStatementLine.Validate("Amount Type", VATStatementLine."Amount Type"::Amount);
+        VATStatementLine.Validate("Incl. Non Deductible VAT", true);
+        VATStatementLine.Validate("Amount Type", VATStatementLine."Amount Type"::"Unrealized Base");
+        VATStatementLine.TestField("Incl. Non Deductible VAT", false);
+    end;
+
     local procedure Initialize()
     var
         VATVIESCorrection: Record "VAT VIES Correction";