diff --git a/src/validation.cpp b/src/validation.cpp
index 1213d8be9f9..47bcf457c2c 100644
--- a/src/validation.cpp
+++ b/src/validation.cpp
@@ -1230,8 +1230,7 @@ bool MemPoolAccept::PolicyScriptChecks(const ATMPArgs& args, Workspace& ws)
     AssertLockHeld(m_pool.cs);
     const CTransaction& tx = *ws.m_ptx;
     TxValidationState& state = ws.m_state;
-
-    constexpr unsigned int scriptVerifyFlags = STANDARD_SCRIPT_VERIFY_FLAGS;
+    const unsigned int scriptVerifyFlags = (m_pool.m_opts.require_standard ? STANDARD_SCRIPT_VERIFY_FLAGS : MANDATORY_SCRIPT_VERIFY_FLAGS);
 
     // Check input scripts and signatures.
     // This is done last to help prevent CPU exhaustion denial-of-service attacks.
@@ -2396,6 +2395,10 @@ static unsigned int GetBlockScriptFlags(const CBlockIndex& block_index, const Ch
 {
     const Consensus::Params& consensusparams = chainman.GetConsensus();
 
+    // Note that any flags returned from this function (ie, specified
+    // here or in script_flag_exceptions) must also be included in
+    // MANDATORY_SCRIPT_VERIFY_FLAGS in policy/policy.h
+
     // BIP16 didn't become active until Apr 1 2012 (on mainnet, and
     // retroactively applied to testnet)
     // However, only one historical block violated the P2SH rules (on both
diff --git a/test/functional/p2p_segwit.py b/test/functional/p2p_segwit.py
index 37c2827ba61..3b82b569589 100755
--- a/test/functional/p2p_segwit.py
+++ b/test/functional/p2p_segwit.py
@@ -1389,14 +1389,13 @@ class SegWitTest(BitcoinTestFramework):
         # Now the node will no longer ask for getdata of this transaction when advertised by same txid
         self.std_node.announce_tx_and_wait_for_getdata(tx3, success=False)
 
-        # Spending a higher version witness output is not allowed by policy,
-        # even with the node that accepts non-standard txs.
-        test_transaction_acceptance(self.nodes[0], self.test_node, tx3, with_witness=True, accepted=False, reason="reserved for soft-fork upgrades")
+        # Spending a higher version witness output is allowed on the node with -acceptnonstdtxn
+        test_transaction_acceptance(self.nodes[0], self.test_node, tx3, with_witness=True, accepted=True)
 
-        # Building a block with the transaction must be valid, however.
+        # Building a block with the transaction must be valid, however even without -acceptnonstdtxn.
         block = self.build_next_block()
         self.update_witness_block_with_transactions(block, [tx2, tx3])
-        test_witness_block(self.nodes[0], self.test_node, block, accepted=True)
+        test_witness_block(self.nodes[1], self.std_node, block, accepted=True)
         self.sync_blocks()
 
         # Add utxo to our list
@@ -1477,11 +1476,11 @@ class SegWitTest(BitcoinTestFramework):
         sign_input_segwitv0(tx2, 0, script, tx.vout[0].nValue, key)
 
         # Should fail policy test.
-        test_transaction_acceptance(self.nodes[0], self.test_node, tx2, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
+        test_transaction_acceptance(self.nodes[1], self.std_node, tx2, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
         # But passes consensus.
         block = self.build_next_block()
         self.update_witness_block_with_transactions(block, [tx2])
-        test_witness_block(self.nodes[0], self.test_node, block, accepted=True)
+        test_witness_block(self.nodes[1], self.std_node, block, accepted=True)
 
         # Test 2: P2WSH
         # Try to spend the P2WSH output created in last test.
@@ -1496,11 +1495,11 @@ class SegWitTest(BitcoinTestFramework):
         sign_p2pk_witness_input(witness_script, tx3, 0, SIGHASH_ALL, tx2.vout[0].nValue, key)
 
         # Should fail policy test.
-        test_transaction_acceptance(self.nodes[0], self.test_node, tx3, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
+        test_transaction_acceptance(self.nodes[1], self.std_node, tx3, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
         # But passes consensus.
         block = self.build_next_block()
         self.update_witness_block_with_transactions(block, [tx3])
-        test_witness_block(self.nodes[0], self.test_node, block, accepted=True)
+        test_witness_block(self.nodes[1], self.std_node, block, accepted=True)
 
         # Test 3: P2SH(P2WSH)
         # Try to spend the P2SH output created in the last test.
@@ -1513,10 +1512,10 @@ class SegWitTest(BitcoinTestFramework):
         sign_p2pk_witness_input(witness_script, tx4, 0, SIGHASH_ALL, tx3.vout[0].nValue, key)
 
         # Should fail policy test.
-        test_transaction_acceptance(self.nodes[0], self.test_node, tx4, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
+        test_transaction_acceptance(self.nodes[1], self.std_node, tx4, True, False, 'non-mandatory-script-verify-flag (Using non-compressed keys in segwit)')
         block = self.build_next_block()
         self.update_witness_block_with_transactions(block, [tx4])
-        test_witness_block(self.nodes[0], self.test_node, block, accepted=True)
+        test_witness_block(self.nodes[1], self.std_node, block, accepted=True)
 
         # Test 4: Uncompressed pubkeys should still be valid in non-segwit
         # transactions.