diff --git a/src/callback.rs b/src/callback.rs
index d81fdccc..b5252cab 100644
--- a/src/callback.rs
+++ b/src/callback.rs
@@ -5,11 +5,13 @@
 use crate::err::{PyErr, PyResult};
 use crate::exceptions::PyOverflowError;
 use crate::ffi::{self, Py_hash_t};
-use crate::IntoPyPointer;
+use crate::panic::PanicException;
+use crate::{GILPool, IntoPyPointer};
 use crate::{IntoPy, PyObject, Python};
-use std::isize;
+use std::any::Any;
 use std::os::raw::c_int;
-use std::panic::UnwindSafe;
+use std::panic::{AssertUnwindSafe, UnwindSafe};
+use std::{isize, panic};
 
 /// A type which can be the return type of a python C-API callback
 pub trait PyCallbackOutput: Copy {
@@ -234,30 +236,33 @@ macro_rules! callback_body {
 #[doc(hidden)]
 pub unsafe fn handle_panic<F, R>(body: F) -> R
 where
-    F: FnOnce(Python) -> crate::PyResult<R> + UnwindSafe,
+    F: FnOnce(Python) -> PyResult<R> + UnwindSafe,
     R: PyCallbackOutput,
 {
-    let pool = crate::GILPool::new();
-    let unwind_safe_py = std::panic::AssertUnwindSafe(pool.python());
-    let result =
-        match std::panic::catch_unwind(move || -> crate::PyResult<_> { body(*unwind_safe_py) }) {
-            Ok(result) => result,
-            Err(e) => {
-                // Try to format the error in the same way panic does
-                if let Some(string) = e.downcast_ref::<String>() {
-                    Err(crate::panic::PanicException::new_err((string.clone(),)))
-                } else if let Some(s) = e.downcast_ref::<&str>() {
-                    Err(crate::panic::PanicException::new_err((s.to_string(),)))
-                } else {
-                    Err(crate::panic::PanicException::new_err((
-                        "panic from Rust code",
-                    )))
-                }
-            }
-        };
+    let pool = GILPool::new();
+    let unwind_safe_py = AssertUnwindSafe(pool.python());
+    let panic_result = panic::catch_unwind(move || -> PyResult<_> {
+        let py = *unwind_safe_py;
+        body(py)
+    });
 
-    result.unwrap_or_else(|e| {
-        e.restore(pool.python());
-        crate::callback::callback_error()
+    panic_result_into_callback_output(pool.python(), panic_result)
+}
+
+fn panic_result_into_callback_output<R>(
+    py: Python,
+    panic_result: Result<PyResult<R>, Box<dyn Any + Send + 'static>>,
+) -> R
+where
+    R: PyCallbackOutput,
+{
+    let py_result = match panic_result {
+        Ok(py_result) => py_result,
+        Err(panic_err) => Err(PanicException::from_panic(panic_err)),
+    };
+
+    py_result.unwrap_or_else(|py_err| {
+        py_err.restore(py);
+        R::ERR_VALUE
     })
 }
diff --git a/src/panic.rs b/src/panic.rs
index 4884278d..366e886a 100644
--- a/src/panic.rs
+++ b/src/panic.rs
@@ -1,4 +1,6 @@
 use crate::exceptions::PyBaseException;
+use crate::PyErr;
+use std::any::Any;
 
 pyo3_exception!(
     "
@@ -11,3 +13,16 @@ pyo3_exception!(
     PanicException,
     PyBaseException
 );
+
+impl PanicException {
+    // Try to format the error in the same way panic does
+    pub(crate) fn from_panic(e: Box<dyn Any + Send + 'static>) -> PyErr {
+        if let Some(string) = e.downcast_ref::<String>() {
+            Self::new_err((string.clone(),))
+        } else if let Some(s) = e.downcast_ref::<&str>() {
+            Self::new_err((s.to_string(),))
+        } else {
+            Self::new_err(("panic from Rust code",))
+        }
+    }
+}