diff --git a/src/Simplex/Messaging/Server.hs b/src/Simplex/Messaging/Server.hs
index daf707711..1643889cb 100644
--- a/src/Simplex/Messaging/Server.hs
+++ b/src/Simplex/Messaging/Server.hs
@@ -739,18 +739,17 @@ smpServer started cfg@ServerConfig {transports, transportConfig = tCfg, startOpt
       ServerConfig {smpServerVRange, smpHandshakeTimeout, information} <- asks config
       let serverInfo = LB.toStrict . J.encode <$> information
       labelMyThread $ "smp handshake for " <> transportName tp
-      newServiceRec <- newTVarIO Nothing
-      liftIO (timeout smpHandshakeTimeout . runExceptT $ smpServerHandshake srvCert srvSignKey h ks kh smpServerVRange serverInfo $ getClientService ms salt idSize newServiceRec) >>= \case
-        Just (Right th) -> runClientTransport th =<< readTVarIO newServiceRec
+      liftIO (timeout smpHandshakeTimeout . runExceptT $ smpServerHandshake srvCert srvSignKey h ks kh smpServerVRange serverInfo $ getClientService ms salt idSize) >>= \case
+        Just (Right (th, newServiceRec)) -> runClientTransport th newServiceRec
         _ -> pure ()
 
-    getClientService :: s -> ByteString -> Int -> TVar (Maybe ServiceRec) -> SMPServiceRole -> X.CertificateChain -> XV.Fingerprint -> ExceptT TransportError IO ServiceId
-    getClientService ms salt idSize newServiceRec role cert fp@(XV.Fingerprint fpBytes) = do
+    getClientService :: s -> ByteString -> Int -> SMPServiceRole -> X.CertificateChain -> XV.Fingerprint -> ExceptT TransportError IO (ServiceId, Maybe ServiceRec)
+    getClientService ms salt idSize role cert fp@(XV.Fingerprint fpBytes) = do
       let newServiceId = EntityId $ B.take idSize $ C.sha3_256 $ salt <> fpBytes
       ts <- liftIO getSystemDate
       let sr = ServiceRec {serviceId = newServiceId, serviceRole = role, serviceCert = cert, serviceCertHash = fp, serviceCreatedAt = ts}
-      withExceptT (const $ TEHandshake BAD_SERVICE) (ExceptT $ getServiceId @(StoreQueue s) (queueStore ms) sr)
-        >>= maybe (newServiceId <$ atomically (writeTVar newServiceRec $ Just sr)) pure
+      withExceptT (const $ TEHandshake BAD_SERVICE) $ ExceptT $
+        maybe (newServiceId, Just sr) (,Nothing) <$$> getServiceId @(StoreQueue s) (queueStore ms) sr
 
     controlPortThread_ :: ServerConfig s -> [M s ()]
     controlPortThread_ ServerConfig {controlPort = Just port} = [runCPServer port]
@@ -1207,8 +1206,7 @@ sendAfterDelay c@Client {sndQ, authDelaySlots, clientTHParams = THandleParams {s
       atomically $ waitTSem authDelaySlots
       elapsed <- subtract (microseconds since) . microseconds <$> getSystemTime
       when (elapsed >= delay) $ incStat $ authDelayExceeded stats
-      forkClient c (B.unpack $ "client $" <> encode sessionId <> " auth") $
-        (threadDelay' (delay - elapsed `mod` delay) >> write) `finally` atomically (signalTSem authDelaySlots)
+      forkClient c (B.unpack $ "client $" <> encode sessionId <> " auth") $ (threadDelay' (delay - elapsed `mod` delay) >> write) `finally` atomically (signalTSem authDelaySlots)
   | otherwise = write
   where
     write = atomically $ writeTBQueue sndQ rs
@@ -1447,12 +1445,10 @@ client
       where
         ifNotNull qs f = if null qs then pure M.empty else f qs
         setService :: (PartyI p, ServiceParty p) => SParty p -> Maybe ServiceId -> [StoreQueue s] -> ExceptT ErrorType IO (Map RecipientId (Either ErrorType ()))
-        setService party sId qs = do
-          storeNewService
-          ExceptT $ setQueueServices (queueStore ms) party sId qs
+        setService party sId qs = forM_ newServiceRec storeService >> ExceptT (setQueueServices (queueStore ms) party sId qs)
 
-    storeNewService :: ExceptT ErrorType IO ()
-    storeNewService = forM_ newServiceRec $ \sr ->
+    storeService :: ServiceRec -> ExceptT ErrorType IO ServiceId
+    storeService sr =
       withExceptT (\case e@SERVICE -> e; e@STORE {} -> e; _ -> INTERNAL) $
         ExceptT $ getCreateService @(StoreQueue s) (queueStore ms) sr
 
@@ -1682,7 +1678,7 @@ client
                                   updatedAt,
                                   rcvServiceId = clntServiceId
                                 }
-                        liftIO (runExceptT storeNewService $>> addQueue ms rcvId qr) >>= \case
+                        liftIO (runExceptT (forM_ newServiceRec storeService) $>> addQueue ms rcvId qr) >>= \case
                           Left DUPLICATE_ -- TODO [short links] possibly, we somehow need to understand which IDs caused collision to retry if it's not client-supplied?
                             | clntIds -> pure $ ERR AUTH -- no retry on collision if sender ID is client-supplied
                             | otherwise -> tryCreate (n - 1)
diff --git a/src/Simplex/Messaging/Transport.hs b/src/Simplex/Messaging/Transport.hs
index 32e33ad1a..6a73545c8 100644
--- a/src/Simplex/Messaging/Transport.hs
+++ b/src/Simplex/Messaging/Transport.hs
@@ -738,7 +738,7 @@ tGetBlock THandle {connection = c, params = THandleParams {blockSize, encryptBlo
 --
 -- See https://github.com/simplex-chat/simplexmq/blob/master/protocol/simplex-messaging.md#appendix-a
 smpServerHandshake ::
-  forall c. Transport c =>
+  forall c a. Transport c =>
   X.CertificateChain ->
   C.APrivateSignKey ->
   c 'TServer ->
@@ -746,8 +746,8 @@ smpServerHandshake ::
   C.KeyHash ->
   VersionRangeSMP ->
   Maybe ByteString ->
-  (SMPServiceRole -> X.CertificateChain -> XV.Fingerprint -> ExceptT TransportError IO ServiceId) ->
-  ExceptT TransportError IO (THandleSMP c 'TServer)
+  (SMPServiceRole -> X.CertificateChain -> XV.Fingerprint -> ExceptT TransportError IO (ServiceId, Maybe a)) ->
+  ExceptT TransportError IO (THandleSMP c 'TServer, Maybe a)
 smpServerHandshake srvCert srvSignKey c (k, pk) kh smpVersionRange serverInfoBytes getService = do
   let sk = C.signX509 srvSignKey $ C.publicToX509 k
   sendHandshake th $ SMPServerHandshake {sessionId, smpVersionRange, authPubKey = CertChainPubKey srvCert sk, serverInfoBytes}
@@ -756,11 +756,11 @@ smpServerHandshake srvCert srvSignKey c (k, pk) kh smpVersionRange serverInfoByt
   case compatibleVRange' smpVersionRange v of
     Just (Compatible vr) -> do
       service <- mapM getClientService clientService
-      liftIO $ smpTHandleServer th v vr pk k' proxyServer service
+      (,snd =<< service) <$> liftIO (smpTHandleServer th v vr pk k' proxyServer $ fst <$> service)
     Nothing -> throwE TEVersion
   where
     th@THandle {params = THandleParams {sessionId}} = smpTHandle c
-    getClientService :: SMPClientHandshakeService -> ExceptT TransportError IO THPeerClientService
+    getClientService :: SMPClientHandshakeService -> ExceptT TransportError IO (THPeerClientService, Maybe a)
     getClientService SMPClientHandshakeService {serviceRole, serviceCertKey = CertChainPubKey cc exact} = handleError sendErr $ do
       unless (getPeerCertChain c == cc) $ throwE $ TEHandshake BAD_AUTH
       (idCert, serviceKey) <- liftEitherWith (const $ TEHandshake BAD_AUTH) $ do
@@ -771,9 +771,9 @@ smpServerHandshake srvCert srvSignKey c (k, pk) kh smpVersionRange serverInfoByt
         serviceCertKey <- getCertVerifyKey leafCert
         (idCert,) <$> (C.x509ToPublic' =<< C.verifyX509 serviceCertKey exact)
       let fp = XV.getFingerprint idCert X.HashSHA256
-      serviceId <- getService serviceRole cc fp
+      (serviceId, extra) <- getService serviceRole cc fp
       sendHandshake th $ SMPServerHandshakeResponse {serviceId}
-      pure THClientService {serviceId, serviceRole, serviceCertHash = fp, serviceKey}
+      pure (THClientService {serviceId, serviceRole, serviceCertHash = fp, serviceKey}, extra)
     sendErr err = do
       sendHandshake th $ SMPServerHandshakeError {handshakeError = err}
       throwError err
diff --git a/tests/AgentTests/FunctionalAPITests.hs b/tests/AgentTests/FunctionalAPITests.hs
index 251fd83cb..179804514 100644
--- a/tests/AgentTests/FunctionalAPITests.hs
+++ b/tests/AgentTests/FunctionalAPITests.hs
@@ -4679,7 +4679,7 @@ testServiceIdChangeOnReconnect ps@(_, ASType qs _) = do
       ("", "", SERVICE_UP _ _) <- nGet service
       ("", "", UP _ [_]) <- nGet user
       pure ()
-    -- Phase 3: Server restart - new service ID, as no queue was associated with the service in phase 2
+    -- Phase 3: Normal reconnect - service should subscribe normally
     ("", "", SERVICE_DOWN _ _) <- nGet service
     ("", "", DOWN _ [_]) <- nGet user
     withSmpServerStoreLogOn ps testPort $ \_ -> do