Aflatoxin B1 (AFB1) contamination of oils is a serious concern for the safety of edible oil consumers. Enzyme-assisted detoxification of AFB1 is an efficient and safe method for decontaminating oils, but pristine enzymes are unstable in oils and require modifications before use. Therefore, we designed a novel and magnetically separable laccase-carrying biocatalyst containing spent-mushroom-substrate (SMS)-derived biochar (BF). Laccase was immobilized on NH2-activated magnetic biochar (BF-NH2) through covalent crosslinking, which provided physicochemical stability to the immobilized enzyme. After 30 days of storage at 4 °C, the immobilized laccase (product named “BF-NH2-Lac”) retained ~95 % of its initial activity, while after five repeated cycles of ABTS oxidation, ~85 % activity retention was observed. BF-NH2-Lac was investigated for the oxidative degradation of AFB1, which exhibited superior performance compared to free laccase. Among many tested natural compounds as mediators, p-coumaric acid proved the most efficient in activating laccase for AFB1 degradation. BF-NH2-Lac demonstrated >90 % removal of AFB1 within 5.0 h, while the observed degradation efficiency in corn oil and buffer was comparable. An insight into the adsorptive and degradative removal of AFB1 revealed that AFB1 removal was governed mainly by degradation. The coexistence of multi-mycotoxins did not significantly affect the AFB1 degradation capability of BF-NH2-Lac. Investigation of the degradation products revealed the transformation of AFB1 into non-toxic AFQ1 while corn oil quality remained unaffected after BF-NH2-Lac treatment. Hence, this study holds practical importance for the research, knowledge-base and industrial application of newly proposed immobilized enzyme products.