The end of the financial year is approaching, which means it’s time to get your tax matters in order. You may have heard before that, yes, you can claim your handbag on tax (with some limits). So, if you’ve been looking for an excuse to splurge on a new tote for work, the time is now.
Not only is your work bag tax deductible, but we’re officially in the end of financial year (EOFY) sales period. (Interested? See our top sales picks…)
However, there are some rules and stipulations around your tax deductible handbag.
Here’s what you need to know.
Can I Claim My Handbag On Tax?
Yes, you can — if it is a work bag.
“Be careful when claiming handbags,” Director of Tax Communications at H&R Block, Mark Chapman, tells ELLE. “The bag needs to be suitable for use for work purposes (for example, carrying papers, files or a laptop) and actually used in your work.”
Here’s what you need to keep in mind:
- The bag must be suitable for work, and be used for work purposes — so, carrying your work laptop or other work items. Suitable bags would be expected to be large enough to fulfil these purposes. Think: tote bags, not micro purses.
- You must have bought it this financial year
- You must have proof of purchase. (In other words, keep your receipt!)
If you use the bag for more than work purposes, you can only claim a portion of it on tax. This includes if it is used to carry “personal items” to work, such as your lunch or beauty products.
Meanwhile, there are different rules for bags that cost over and under $300.
- Above $300: Your bag will need to be claimed as a depreciating asset over several years
- $300 or under: This is when you can claim an immediate deduction, if you use your bag more than 50% of the time for a work purpose.
If you’re keen and eager to get shopping, here are some of our favourite work bags to purchase this year.
The Best Tax-Deductible Handbags in 2024
Como Tote by Camilla & Marc
from $220 at The Iconic
Best all-rounder work bag
The ultimate in work companions, this C&M tote bag is the perfect ‘stealth wealth’ bag, containing a classic silhouette and no glaring insignia.
Size: 33cm x 42cm x 15cm | Colours: Black, Camel | Materials: Polyester
Available at:
Best budget friendly work bag
A timeless style but with unique brass buckle detailing, the large tote bag is perfect for carrying your work gear to and from the office.
Sizes: 43 cm x 30 cm x 16cm | Colours: Black, Ecru, Latte | Materials: PU
Available at:
Classic Leather Tote by & Other Stories
$ 169 at The Iconic
Best on-trend work bag
This 100% leather bag is in the season’s trending style in a lovely soft-grain leather.
Size: 37 cm x 34cm | Colours: Black | Materials: 100% leather
Available at:
Medium Book Tote by Dior
$6,000 at Dior
Best designer bag
The more expensive a bag is, the more questions the ATO could have for you. However, if you can prove it is more than 50% for work and for carrying work things… you may be in with a fighting chance.
Size: 36.5 x 28 x 17.5 cm | Colours: Various (pictured: The white and navy Blue Toile de Jouy Sauvage) | Materials: embroidered canvas and calfskin
Available at:
Best straw bag
Sensi Studio partners with masters of Toquilla straw handweaving to create the Canasta tote. The perfect bag for a more casual workplace. The black and multi-colour options are slightly less expensive at $403 and $395 respectively.
Size: 24cm x 31 cm x 17 cm | Colours: Beige, Black or ‘fuschia’ (Multicolour) | Materials: Toquilla straw
Available at:
Lucy Tote by Peta & Jain
$89.95 (Now $62) at The Iconic
Best brown bag
This chocolate-coloured tote is deep enough to provide a luscious laptop for your home, while also being very friendly to your wallet. This is also a great ‘leather’ tote for the environmentally conscious, being constructed from PETA-certified vegan leather.
Size: 38cm x 38cm x 22cm | Colours: Chocolate, tan | Materials: Polyurethane, Polyester (lining)
Available at:
Can Luggage Be Tax Deductible?
Yes, but only if it is for work. For example, if you are a pilot or flight attendant, you should be able to claim luggage as a work expense. Otherwise, it would be difficult to prove that you are carrying goods related to your work and not your personal life in your luggage.
Can You Claim A Luxury Bag on Tax?
It is possible, but you will need to be able to prove it is solely for work purposes.
“An expensive brand handbag is deductible provided it meets these criteria (although it potentially needs to be written off over several years if it costs more than $300),” Mark from H&R Block adds.
“But be aware that the more expensive the bag, the more likely the ATO is to query it!”
Looking to save money on bags? Check out our coupon codes for The Iconic, ASOS and more.
Related article:
