GOOD NEWS: The Tax Office has confirmed your handbag may be tax deductible.

Handbags used for work purposes have been confirmed as an item that can be claimed as a tax deduction.

The news comes after the Australian Financial Review exposed handbags as being not tax-deductible as they were considered ‘hallmarks of private expense’.

But in a world where ‘handbags’ are often large enough to carry laptops and other business equipment, the confirmation really just confirms our suspicions that our bags have been unfairly exempt.

Assistant Tax Commissioner Graham Whyte told Financy.com.au there exists the opportunity for claims to be made on handbags.

“You can claim a deduction for assets that are predominantly used for work purposes, such as bags and satchels used to carry work papers or electronic devices, to the extent that such items are used for work purposes,” he said.

Work purposes are however, difficult to prove outright.

handbag tax deductible
Large enough to hold a laptop, sharp enough to take to lunch. Source: original.

PricewaterhouseCoopers private clients partner Paul Brassil encourages women to keep at records of what they are placing in their bags.

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“Fundamentally if you are carrying work items to and from work, be that a laptop, work papers and minor personal items, then you are in a position to claim a reasonable deduction for the cost of a handbag or manbag,” he told Financy.com.au.

Brassil also warns against purchasing particularly expensive bags as this may be seen as an unnecessary private expense.

“If you have an ultra-expensive item then you are very likely to get a challenge from the Australian Tax Office (ATO) if you make a claim,” he said.

cropped bag better 2
If you think it can only fit your lunchbox, you might want to think again. Source: original.

Whitehead Dingley & Betar chartered accountant and partner Kate Hills spoke to Financy.com.au about how she currently claims a tax deduction for her work handbag.

“I find it hard to see how the two situations are different for a man and woman. The only difference I see is that one bag is called a ‘handbag’ and the other a ‘satchel/briefcase’,” she said.

The confirmation may be in but before you rush off with fistfuls of plastic, platinum or cash, just be aware that no claim is guaranteed.

Click below to see some of our favourite (but perhaps not tax-deductibe) bags in the Mamamia office:

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