diff --git a/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeInferenceContext.kt b/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeInferenceContext.kt
index 9636f9805c6..bf8859163de 100644
--- a/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeInferenceContext.kt
+++ b/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeInferenceContext.kt
@@ -58,10 +58,10 @@ interface ConeInferenceContext : TypeSystemInferenceExtensionContext, ConeTypeCo
         arguments: List<TypeArgumentMarker>,
         nullable: Boolean,
         isExtensionFunction: Boolean,
-        annotations: List<AnnotationMarker>?
+        attributes: List<AnnotationMarker>?
     ): SimpleTypeMarker {
-        val attributesList = annotations?.filterIsInstanceTo<ConeAttribute<*>, MutableList<ConeAttribute<*>>>(mutableListOf())
-        val attributes: ConeAttributes = if (isExtensionFunction) {
+        val attributesList = attributes?.filterIsInstanceTo<ConeAttribute<*>, MutableList<ConeAttribute<*>>>(mutableListOf())
+        val coneAttributes: ConeAttributes = if (isExtensionFunction) {
             require(constructor is ConeClassLikeLookupTag && constructor.isBuiltinFunctionalType())
             // We don't want to create new instance of ConeAttributes which
             //   contains only CompilerConeAttributes.ExtensionFunctionType
@@ -81,12 +81,12 @@ interface ConeInferenceContext : TypeSystemInferenceExtensionContext, ConeTypeCo
                 constructor,
                 (arguments as List<ConeTypeProjection>).toTypedArray(),
                 nullable,
-                attributes,
+                coneAttributes,
             )
             is ConeTypeParameterLookupTag -> ConeTypeParameterTypeImpl(
                 constructor,
                 nullable,
-                attributes
+                coneAttributes
             )
             else -> error("!")
         }
diff --git a/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt b/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
index fdee372f5ad..a04392d60ef 100644
--- a/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
+++ b/compiler/fir/providers/src/org/jetbrains/kotlin/fir/types/ConeTypeContext.kt
@@ -420,6 +420,12 @@ interface ConeTypeContext : TypeSystemContext, TypeSystemOptimizationContext, Ty
         return attributes.toList()
     }
 
+    override fun KotlinTypeMarker.hasCustomAttributes(): Boolean {
+        require(this is ConeKotlinType)
+        val compilerAttributes = CompilerConeAttributes.classIdByCompilerAttribute
+        return this.attributes.any { it !in compilerAttributes && it !is CustomAnnotationTypeAttribute }
+    }
+
     override fun KotlinTypeMarker.getCustomAttributes(): List<AnnotationMarker> {
         require(this is ConeKotlinType)
         val compilerAttributes = CompilerConeAttributes.classIdByCompilerAttribute
diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/checkers/PassingProgressionAsCollectionCallChecker.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/checkers/PassingProgressionAsCollectionCallChecker.kt
index c0949a8cae9..839cd737b1d 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/checkers/PassingProgressionAsCollectionCallChecker.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/checkers/PassingProgressionAsCollectionCallChecker.kt
@@ -145,7 +145,7 @@ class PassingProgressionAsCollectionCallChecker(private val kotlinCallResolver:
 
     private fun makeCollectionOfAnyType(builtIns: KotlinBuiltIns): KotlinType =
         KotlinTypeFactory.simpleNotNullType(
-            Annotations.EMPTY,
+            TypeAttributes.Empty,
             builtIns.collection,
             listOf(TypeProjectionImpl(builtIns.nullableAnyType))
         )
@@ -162,7 +162,7 @@ class PassingProgressionAsCollectionCallChecker(private val kotlinCallResolver:
         val newType = intersectTypes(
             listOf(
                 KotlinTypeFactory.simpleNotNullType(
-                    Annotations.EMPTY,
+                    TypeAttributes.Empty,
                     builtIns.collection,
                     listOf(TypeProjectionImpl(progressionOrRangeElementType))
                 ),
diff --git a/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt b/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
index a583cdc4d8a..56837cc4936 100644
--- a/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
+++ b/compiler/ir/ir.tree/src/org/jetbrains/kotlin/ir/types/IrTypeSystemContext.kt
@@ -332,10 +332,10 @@ interface IrTypeSystemContext : TypeSystemContext, TypeSystemCommonSuperTypesCon
         arguments: List<TypeArgumentMarker>,
         nullable: Boolean,
         isExtensionFunction: Boolean,
-        annotations: List<AnnotationMarker>?
+        attributes: List<AnnotationMarker>?
     ): SimpleTypeMarker {
-        val ourAnnotations = annotations?.filterIsInstance<IrConstructorCall>()
-        require(ourAnnotations?.size == annotations?.size)
+        val ourAnnotations = attributes?.filterIsInstance<IrConstructorCall>()
+        require(ourAnnotations?.size == attributes?.size)
         return IrSimpleTypeImpl(
             constructor as IrClassifierSymbol,
             nullable,
@@ -406,6 +406,10 @@ interface IrTypeSystemContext : TypeSystemContext, TypeSystemCommonSuperTypesCon
         return this.annotations.map { object : AnnotationMarker, IrElement by it {} }
     }
 
+    override fun KotlinTypeMarker.hasCustomAttributes(): Boolean {
+        return false
+    }
+
     override fun KotlinTypeMarker.getCustomAttributes(): List<AnnotationMarker> {
         require(this is IrType)
         return emptyList()
diff --git a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/NewCommonSuperTypeCalculator.kt b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/NewCommonSuperTypeCalculator.kt
index 4a8a07a2738..1b9051e4a62 100644
--- a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/NewCommonSuperTypeCalculator.kt
+++ b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/NewCommonSuperTypeCalculator.kt
@@ -15,7 +15,7 @@ import org.jetbrains.kotlin.types.model.*
 object NewCommonSuperTypeCalculator {
     fun TypeSystemCommonSuperTypesContext.commonSuperType(types: List<KotlinTypeMarker>): KotlinTypeMarker {
         val maxDepth = types.maxOfOrNull { it.typeDepth() } ?: 0
-        return commonSuperType(types, -maxDepth, true).replaceTypeAttributes(unionTypeAttributes(types))
+        return commonSuperType(types, -maxDepth, true).let { it.replaceTypeAttributes(unionTypeAttributes(listOf(it) + types)) }
     }
 
     private fun TypeSystemCommonSuperTypesContext.commonSuperType(
diff --git a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/components/PostponedArgumentInputTypesResolver.kt b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/components/PostponedArgumentInputTypesResolver.kt
index 06d4d9142f7..3aad91c438d 100644
--- a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/components/PostponedArgumentInputTypesResolver.kt
+++ b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/components/PostponedArgumentInputTypesResolver.kt
@@ -411,7 +411,7 @@ class PostponedArgumentInputTypesResolver(
                 argument.isFunctionExpressionWithReceiver() -> true
                 else -> parameterTypesInfo.isExtensionFunction
             },
-            annotations = parameterTypesInfo.annotations
+            attributes = parameterTypesInfo.annotations
         )
 
         getBuilder().addSubtypeConstraint(
diff --git a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/model/MutableConstraintStorage.kt b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/model/MutableConstraintStorage.kt
index 54d6fd39478..5a8ce969dee 100644
--- a/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/model/MutableConstraintStorage.kt
+++ b/compiler/resolution.common/src/org/jetbrains/kotlin/resolve/calls/inference/model/MutableConstraintStorage.kt
@@ -59,14 +59,18 @@ class MutableVariableWithConstraints private constructor(
                 && previousConstraint.type == constraint.type
                 && previousConstraint.isNullabilityConstraint == constraint.isNullabilityConstraint
             ) {
+                val noNewCustomAttributes = with(context) {
+                    val previousType = previousConstraint.type
+                    val type = constraint.type
+                    (!previousType.hasCustomAttributes() && !type.hasCustomAttributes()) ||
+                            (previousType.getCustomAttributes() == type.getCustomAttributes())
+                }
+
                 if (newConstraintIsUseless(previousConstraint, constraint)) {
                     // Preserve constraints with different custom type attributes.
                     // This allows us to union type attributes in NewCommonSuperTypeCalculator.kt
-                    with(context) {
-                        val prevAttributes = previousConstraint.type.getCustomAttributes()
-                        if (prevAttributes.isEmpty() || prevAttributes == constraint.type.getCustomAttributes()) {
-                            return previousConstraint to false
-                        }
+                    if (noNewCustomAttributes) {
+                        return previousConstraint to false
                     }
                 }
 
@@ -75,7 +79,7 @@ class MutableVariableWithConstraints private constructor(
                     ConstraintKind.UPPER -> constraint.kind.isLower()
                     ConstraintKind.EQUALITY -> true
                 }
-                if (isMatchingForSimplification) {
+                if (isMatchingForSimplification && noNewCustomAttributes) {
                     val actualConstraint = if (constraint.kind != ConstraintKind.EQUALITY) {
                         Constraint(
                             ConstraintKind.EQUALITY,
diff --git a/compiler/resolution/src/org/jetbrains/kotlin/resolve/calls/inference/components/NewTypeSubstitutor.kt b/compiler/resolution/src/org/jetbrains/kotlin/resolve/calls/inference/components/NewTypeSubstitutor.kt
index aafa6f9846d..0caea49d935 100644
--- a/compiler/resolution/src/org/jetbrains/kotlin/resolve/calls/inference/components/NewTypeSubstitutor.kt
+++ b/compiler/resolution/src/org/jetbrains/kotlin/resolve/calls/inference/components/NewTypeSubstitutor.kt
@@ -6,7 +6,6 @@
 package org.jetbrains.kotlin.resolve.calls.inference.components
 
 import org.jetbrains.kotlin.descriptors.TypeParameterDescriptor
-import org.jetbrains.kotlin.descriptors.annotations.CompositeAnnotations
 import org.jetbrains.kotlin.resolve.calls.inference.isCaptured
 import org.jetbrains.kotlin.resolve.calls.inference.model.TypeVariableFromCallableDescriptor
 import org.jetbrains.kotlin.resolve.calls.inference.substitute
diff --git a/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt b/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
index 39a455e736f..a7b929e9c7c 100644
--- a/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
+++ b/core/compiler.common/src/org/jetbrains/kotlin/types/model/TypeSystemContext.kt
@@ -80,7 +80,7 @@ interface TypeSystemTypeFactoryContext: TypeSystemBuiltInsContext {
         arguments: List<TypeArgumentMarker>,
         nullable: Boolean,
         isExtensionFunction: Boolean = false,
-        annotations: List<AnnotationMarker>? = null
+        attributes: List<AnnotationMarker>? = null
     ): SimpleTypeMarker
 
     fun createTypeArgument(type: KotlinTypeMarker, variance: TypeVariance): TypeArgumentMarker
@@ -500,6 +500,8 @@ interface TypeSystemContext : TypeSystemOptimizationContext {
 
     fun KotlinTypeMarker.getAttributes(): List<AnnotationMarker>
 
+    fun KotlinTypeMarker.hasCustomAttributes(): Boolean
+
     fun KotlinTypeMarker.getCustomAttributes(): List<AnnotationMarker>
 
     fun substitutionSupertypePolicy(type: SimpleTypeMarker): TypeCheckerState.SupertypesPolicy
diff --git a/core/descriptors/src/org/jetbrains/kotlin/resolve/calls/inference/CapturedTypeConstructor.kt b/core/descriptors/src/org/jetbrains/kotlin/resolve/calls/inference/CapturedTypeConstructor.kt
index 41072a385d3..3fa2a6ecef0 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/resolve/calls/inference/CapturedTypeConstructor.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/resolve/calls/inference/CapturedTypeConstructor.kt
@@ -78,9 +78,6 @@ class CapturedType(
     override val attributes: TypeAttributes = TypeAttributes.Empty
 ) : SimpleType(), SubtypingRepresentatives, CapturedTypeMarker {
 
-    override val annotations: Annotations
-        get() = attributes.toDefaultAnnotations()
-
     override val arguments: List<TypeProjection>
         get() = listOf()
 
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/AnnotationsTypeAttribute.kt b/core/descriptors/src/org/jetbrains/kotlin/types/AnnotationsTypeAttribute.kt
index 9f3a2b3ffdc..8bc7630d753 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/AnnotationsTypeAttribute.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/AnnotationsTypeAttribute.kt
@@ -5,31 +5,24 @@
 
 package org.jetbrains.kotlin.types
 
-import org.jetbrains.kotlin.descriptors.annotations.AnnotationDescriptor
 import org.jetbrains.kotlin.descriptors.annotations.Annotations
+import org.jetbrains.kotlin.descriptors.annotations.composeAnnotations
 import kotlin.reflect.KClass
 
 class AnnotationsTypeAttribute(val annotations: Annotations) : TypeAttribute<AnnotationsTypeAttribute>() {
-    constructor(annotations: List<AnnotationDescriptor>) : this(Annotations.create(annotations))
+    override fun union(other: AnnotationsTypeAttribute?): AnnotationsTypeAttribute = this
 
-    override fun union(other: AnnotationsTypeAttribute?): AnnotationsTypeAttribute? = null
-
-    override fun intersect(other: AnnotationsTypeAttribute?): AnnotationsTypeAttribute? = null
+    override fun intersect(other: AnnotationsTypeAttribute?): AnnotationsTypeAttribute = this
 
     override fun add(other: AnnotationsTypeAttribute?): AnnotationsTypeAttribute {
         if (other == null) return this
-        return AnnotationsTypeAttribute(Annotations.create(annotations + other.annotations))
+        return AnnotationsTypeAttribute(composeAnnotations(annotations, other.annotations))
     }
 
     override fun isSubtypeOf(other: AnnotationsTypeAttribute?): Boolean = true
 
     override val key: KClass<out AnnotationsTypeAttribute>
         get() = AnnotationsTypeAttribute::class
-
-    override fun equals(other: Any?): Boolean {
-        if (other !is AnnotationsTypeAttribute) return false
-        return annotations == other.annotations
-    }
 }
 
 val TypeAttributes.annotationsAttribute: AnnotationsTypeAttribute? by TypeAttributes.attributeAccessor<AnnotationsTypeAttribute>()
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/ErrorType.kt b/core/descriptors/src/org/jetbrains/kotlin/types/ErrorType.kt
index 2fbfe2e4b2b..c0a945ef2b9 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/ErrorType.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/ErrorType.kt
@@ -27,9 +27,6 @@ open class ErrorType @JvmOverloads internal constructor(
     override val isMarkedNullable: Boolean = false,
     open val presentableName: String = "???"
 ) : SimpleType() {
-    override val annotations: Annotations
-        get() = Annotations.EMPTY
-
     override val attributes: TypeAttributes
         get() = TypeAttributes.Empty
 
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/KotlinType.kt b/core/descriptors/src/org/jetbrains/kotlin/types/KotlinType.kt
index b84c606319d..15b0118f640 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/KotlinType.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/KotlinType.kt
@@ -52,6 +52,8 @@ sealed class KotlinType : Annotated, KotlinTypeMarker {
     abstract val isMarkedNullable: Boolean
     abstract val memberScope: MemberScope
     abstract val attributes: TypeAttributes
+    override val annotations: Annotations
+        get() = attributes.annotations
 
     abstract fun unwrap(): UnwrappedType
 
@@ -125,7 +127,6 @@ abstract class WrappedType : KotlinType() {
     open fun isComputed(): Boolean = true
     protected abstract val delegate: KotlinType
 
-    override val annotations: Annotations get() = delegate.annotations
     override val constructor: TypeConstructor get() = delegate.constructor
     override val arguments: List<TypeProjection> get() = delegate.arguments
     override val isMarkedNullable: Boolean get() = delegate.isMarkedNullable
@@ -210,12 +211,11 @@ abstract class FlexibleType(val lowerBound: SimpleType, val upperBound: SimpleTy
 
     abstract fun render(renderer: DescriptorRenderer, options: DescriptorRendererOptions): String
 
-    override val annotations: Annotations get() = delegate.annotations
+    override val attributes: TypeAttributes get() = delegate.attributes
     override val constructor: TypeConstructor get() = delegate.constructor
     override val arguments: List<TypeProjection> get() = delegate.arguments
     override val isMarkedNullable: Boolean get() = delegate.isMarkedNullable
     override val memberScope: MemberScope get() = delegate.memberScope
-    override val attributes: TypeAttributes get() = delegate.attributes
 
     override fun toString(): String = DescriptorRenderer.DEBUG_TEXT.renderType(this)
 
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/KotlinTypeFactory.kt b/core/descriptors/src/org/jetbrains/kotlin/types/KotlinTypeFactory.kt
index 7efd3979202..8c97ddac9d2 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/KotlinTypeFactory.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/KotlinTypeFactory.kt
@@ -206,7 +206,6 @@ private class SimpleTypeImpl(
     @TypeRefinement
     override val hasNotTrivialRefinementFactory: Boolean get() = true
 
-    override val annotations: Annotations get() = Annotations.EMPTY
     override val attributes: TypeAttributes get() = TypeAttributes.Empty
 
     override fun replaceAttributes(newAttributes: TypeAttributes) =
@@ -254,7 +253,6 @@ class SupposititiousSimpleType(private val realType: SimpleType, val overwritten
     override val arguments: List<TypeProjection> = realType.arguments
     override val isMarkedNullable: Boolean = realType.isMarkedNullable
     override val memberScope: MemberScope = realType.memberScope
-    override val annotations: Annotations = realType.annotations
     override val attributes: TypeAttributes get() = realType.attributes
 }
 
@@ -275,8 +273,6 @@ private class SimpleTypeWithAttributes(
     delegate: SimpleType,
     override val attributes: TypeAttributes
 ) : DelegatingSimpleTypeImpl(delegate) {
-    override val annotations: Annotations
-        get() = attributes.toDefaultAnnotations()
     @TypeRefinement
     override fun replaceDelegate(delegate: SimpleType) = SimpleTypeWithAttributes(delegate, attributes)
 }
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/SpecialTypes.kt b/core/descriptors/src/org/jetbrains/kotlin/types/SpecialTypes.kt
index aaa9037c868..9c436a7ac3e 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/SpecialTypes.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/SpecialTypes.kt
@@ -30,7 +30,6 @@ import org.jetbrains.kotlin.types.model.DefinitelyNotNullTypeMarker
 abstract class DelegatingSimpleType : SimpleType() {
     protected abstract val delegate: SimpleType
 
-    override val annotations: Annotations get() = delegate.annotations
     override val constructor: TypeConstructor get() = delegate.constructor
     override val arguments: List<TypeProjection> get() = delegate.arguments
     override val isMarkedNullable: Boolean get() = delegate.isMarkedNullable
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/StubTypes.kt b/core/descriptors/src/org/jetbrains/kotlin/types/StubTypes.kt
index 8e9650e358a..92098a45196 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/StubTypes.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/StubTypes.kt
@@ -58,9 +58,6 @@ abstract class AbstractStubType(val originalTypeVariable: TypeConstructor, overr
     override val arguments: List<TypeProjection>
         get() = emptyList()
 
-    override val annotations: Annotations
-        get() = Annotations.EMPTY
-
     override val attributes: TypeAttributes
         get() = TypeAttributes.Empty
 
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAliasExpander.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAliasExpander.kt
index 1522d9a4474..20cd671e002 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAliasExpander.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAliasExpander.kt
@@ -135,7 +135,7 @@ class TypeAliasExpander(
         replaceAttributes(createdCombinedAttributes(newAttributes))
 
     private fun SimpleType.combineAttributes(newAttributes: TypeAttributes): SimpleType =
-        if (isError) this else replaceAttributes(newAttributes = createdCombinedAttributes(newAttributes))
+        if (isError) this else replace(newAttributes = createdCombinedAttributes(newAttributes))
 
     private fun KotlinType.createdCombinedAttributes(newAttributes: TypeAttributes): TypeAttributes {
         if (isError) return attributes
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributeTranslator.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributeTranslator.kt
index 86f3485750f..1b26d4125c4 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributeTranslator.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributeTranslator.kt
@@ -25,7 +25,9 @@ object DefaultTypeAttributeTranslator : TypeAttributeTranslator {
         typeConstructor: TypeConstructor?,
         containingDeclaration: DeclarationDescriptor?
     ): TypeAttributes {
-        return TypeAttributes.create(listOf(AnnotationsTypeAttribute(annotations)))
+        return if (annotations.isEmpty())
+            TypeAttributes.Empty else
+            TypeAttributes.create(listOf(AnnotationsTypeAttribute(annotations)))
     }
 
     override fun toAnnotations(attributes: TypeAttributes): Annotations {
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributes.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributes.kt
index ad406aa5dfa..2ddf3c769ad 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributes.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeAttributes.kt
@@ -51,7 +51,7 @@ class TypeAttributes private constructor(attributes: List<TypeAttribute<*>>) : A
             }
         }
 
-        val Empty: TypeAttributes = TypeAttributes(listOf(AnnotationsTypeAttribute(Annotations.EMPTY)))
+        val Empty: TypeAttributes = TypeAttributes(emptyList())
 
         fun create(attributes: List<TypeAttribute<*>>): TypeAttributes {
             return if (attributes.isEmpty()) {
@@ -70,6 +70,8 @@ class TypeAttributes private constructor(attributes: List<TypeAttribute<*>>) : A
         }
     }
 
+    val size: Int get() = arrayMap.size
+
     fun union(other: TypeAttributes): TypeAttributes {
         return perform(other) { this.union(it) }
     }
@@ -87,15 +89,11 @@ class TypeAttributes private constructor(attributes: List<TypeAttribute<*>>) : A
         return arrayMap[index] != null
     }
 
-    @OptIn(ExperimentalStdlibApi::class)
     operator fun plus(attribute: TypeAttribute<*>): TypeAttributes {
         if (attribute in this) return this
         if (isEmpty()) return TypeAttributes(attribute)
-        val newAttributes = buildList {
-            addAll(this)
-            add(attribute)
-        }
-        return TypeAttributes(newAttributes)
+        val newAttributes = this.toList() + attribute
+        return create(newAttributes)
     }
 
     fun remove(attribute: TypeAttribute<*>): TypeAttributes {
@@ -119,6 +117,7 @@ class TypeAttributes private constructor(attributes: List<TypeAttribute<*>>) : A
 
     override val typeRegistry: TypeRegistry<TypeAttribute<*>, TypeAttribute<*>>
         get() = Companion
+
 }
 
 fun TypeAttributes.toDefaultAnnotations(): Annotations =
@@ -127,6 +126,9 @@ fun TypeAttributes.toDefaultAnnotations(): Annotations =
 fun Annotations.toDefaultAttributes(): TypeAttributes = DefaultTypeAttributeTranslator.toAttributes(this)
 
 fun TypeAttributes.replaceAnnotations(newAnnotations: Annotations): TypeAttributes {
-    val withoutCustom = (annotationsAttribute?.let { this.remove(it) } ?: this)
-    return withoutCustom.add(newAnnotations.toDefaultAttributes())
+    if (annotations === newAnnotations) return this
+    val withoutAnnotations = annotationsAttribute?.let { this.remove(it) } ?: this
+    // Check if iterator hasNext to handle FilteredAnnotations.isEmpty() with OldInference
+    if (!newAnnotations.iterator().hasNext() && newAnnotations.isEmpty()) return withoutAnnotations
+    return withoutAnnotations.plus(AnnotationsTypeAttribute(newAnnotations))
 }
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeSubstitution.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeSubstitution.kt
index ad6943ebd16..69da4e34ae4 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeSubstitution.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeSubstitution.kt
@@ -18,6 +18,7 @@ package org.jetbrains.kotlin.types
 
 import org.jetbrains.kotlin.descriptors.TypeParameterDescriptor
 import org.jetbrains.kotlin.descriptors.annotations.Annotations
+import org.jetbrains.kotlin.descriptors.annotations.FilteredAnnotations
 
 abstract class TypeSubstitution {
     companion object {
@@ -50,6 +51,7 @@ abstract class TypeSubstitution {
         override fun filterAnnotations(annotations: Annotations) = this@TypeSubstitution.filterAnnotations(annotations)
         override fun prepareTopLevelType(topLevelType: KotlinType, position: Variance) =
             this@TypeSubstitution.prepareTopLevelType(topLevelType, position)
+
         override fun isEmpty() = this@TypeSubstitution.isEmpty()
     }
 }
@@ -144,23 +146,26 @@ fun KotlinType.replace(
 ): KotlinType {
     if ((newArguments.isEmpty() || newArguments === arguments) && newAnnotations === annotations) return this
 
+    val newAttributes = attributes.replaceAnnotations(
+        // Specially handle FilteredAnnotations here due to FilteredAnnotations.isEmpty()
+        if (newAnnotations is FilteredAnnotations && newAnnotations.isEmpty()) Annotations.EMPTY else newAnnotations
+    )
+
     return when (val unwrapped = unwrap()) {
         is FlexibleType -> KotlinTypeFactory.flexibleType(
-            unwrapped.lowerBound.replace(newArguments, newAnnotations),
-            unwrapped.upperBound.replace(newArgumentsForUpperBound, newAnnotations)
+            unwrapped.lowerBound.replace(newArguments, newAttributes),
+            unwrapped.upperBound.replace(newArgumentsForUpperBound, newAttributes)
         )
-        is SimpleType -> unwrapped.replace(newArguments, newAnnotations)
+        is SimpleType -> unwrapped.replace(newArguments, newAttributes)
     }
 }
 
 @JvmOverloads
 fun SimpleType.replace(
     newArguments: List<TypeProjection> = arguments,
-    newAnnotations: Annotations = annotations
+    newAttributes: TypeAttributes = attributes
 ): SimpleType {
-    if (newArguments.isEmpty() && newAnnotations === annotations) return this
-
-    val newAttributes = attributes.replaceAnnotations(newAnnotations)
+    if (newArguments.isEmpty() && newAttributes === attributes) return this
 
     if (newArguments.isEmpty()) {
         return replaceAttributes(newAttributes)
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt b/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
index ad4d966a32f..1b32aad3973 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/checker/ClassicTypeSystemContext.kt
@@ -26,6 +26,7 @@ import org.jetbrains.kotlin.resolve.unsubstitutedUnderlyingType
 import org.jetbrains.kotlin.types.*
 import org.jetbrains.kotlin.types.model.*
 import org.jetbrains.kotlin.types.typeUtil.*
+import org.jetbrains.kotlin.utils.addToStdlib.firstIsInstanceOrNull
 import org.jetbrains.kotlin.utils.addToStdlib.safeAs
 import org.jetbrains.kotlin.types.typeUtil.isSignedOrUnsignedNumberType as classicIsSignedOrUnsignedNumberType
 
@@ -516,12 +517,11 @@ interface ClassicTypeSystemContext : TypeSystemInferenceExtensionContext, TypeSy
         arguments: List<TypeArgumentMarker>,
         nullable: Boolean,
         isExtensionFunction: Boolean,
-        annotations: List<AnnotationMarker>?
+        attributes: List<AnnotationMarker>?
     ): SimpleTypeMarker {
         require(constructor is TypeConstructor, constructor::errorMessage)
 
-        val ourAnnotations = annotations?.filterIsInstance<AnnotationDescriptor>()
-        require(ourAnnotations?.size == annotations?.size)
+        val ourAnnotations = attributes?.firstIsInstanceOrNull<AnnotationsTypeAttribute>()?.annotations?.toList()
 
         fun createExtensionFunctionAnnotation() = BuiltInAnnotationDescriptor(builtIns, FqNames.extensionFunctionType, emptyMap())
 
@@ -673,6 +673,11 @@ interface ClassicTypeSystemContext : TypeSystemInferenceExtensionContext, TypeSy
         return this.attributes.toList()
     }
 
+    override fun KotlinTypeMarker.hasCustomAttributes(): Boolean {
+        require(this is KotlinType, this::errorMessage)
+        return this.attributes.size > 1
+    }
+
     override fun KotlinTypeMarker.getCustomAttributes(): List<AnnotationMarker> {
         require(this is KotlinType, this::errorMessage)
         return this.attributes.filterNot { it is AnnotationsTypeAttribute }
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/checker/NewCapturedType.kt b/core/descriptors/src/org/jetbrains/kotlin/types/checker/NewCapturedType.kt
index b4c152c6124..393f8c2c73f 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/checker/NewCapturedType.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/checker/NewCapturedType.kt
@@ -207,16 +207,13 @@ class NewCapturedType(
         captureStatus: CaptureStatus, lowerType: UnwrappedType?, projection: TypeProjection, typeParameter: TypeParameterDescriptor
     ) : this(captureStatus, NewCapturedTypeConstructor(projection, typeParameter = typeParameter), lowerType)
 
-    override val annotations: Annotations
-        get() = attributes.toDefaultAnnotations()
-
     override val arguments: List<TypeProjection> get() = listOf()
 
     override val memberScope: MemberScope // todo what about foo().bar() where foo() return captured type?
         get() = ErrorUtils.createErrorScope("No member resolution should be done on captured type!", true)
 
     override fun replaceAttributes(newAttributes: TypeAttributes): SimpleType =
-        NewCapturedType(captureStatus, constructor, lowerType, newAttributes, isMarkedNullable)
+        NewCapturedType(captureStatus, constructor, lowerType, newAttributes, isMarkedNullable, isProjectionNotNull)
 
     override fun makeNullableAsSpecified(newNullability: Boolean) =
         NewCapturedType(captureStatus, constructor, lowerType, attributes, newNullability)