Abstract
A bit holder comprises a sleeve having a bore for receiving a bit and a through-hole in a wall of the sleeve connected to the bore. A magnet is arranged to engage the bit and wherein the magnet is moveable within the bore between a first position when the bit is seated in the bore and a second position when the bit is partially ejected from the bore. A magnet retaining element is mounted in the through-hole and arranged to protrude into the bore and engage a portion of the magnet when the magnet is in the second position.