diff --git a/src/wallet/rpcwallet.cpp b/src/wallet/rpcwallet.cpp
--- a/src/wallet/rpcwallet.cpp
+++ b/src/wallet/rpcwallet.cpp
@@ -3499,7 +3499,8 @@
         CTxDestination address;
         const CScript &scriptPubKey = out.tx->tx->vout[out.i].scriptPubKey;
         bool fValidAddress = ExtractDestination(scriptPubKey, address);
-        bool reused = avoid_reuse && pwallet->IsUsedDestination(address);
+        bool reused =
+            avoid_reuse && pwallet->IsUsedDestination(out.tx->GetId(), out.i);
 
         if (destinations.size() &&
             (!fValidAddress || !destinations.count(address))) {
diff --git a/src/wallet/wallet.h b/src/wallet/wallet.h
--- a/src/wallet/wallet.h
+++ b/src/wallet/wallet.h
@@ -904,8 +904,8 @@
         EXCLUSIVE_LOCKS_REQUIRED(cs_wallet);
 
     // Whether this or any UTXO with the same CTxDestination has been spent.
-    bool IsUsedDestination(const CTxDestination &dst) const;
-    bool IsUsedDestination(const TxId &txid, unsigned int n) const;
+    bool IsUsedDestination(const TxId &txid, unsigned int n) const
+        EXCLUSIVE_LOCKS_REQUIRED(cs_wallet);
     void SetUsedDestinationState(WalletBatch &batch, const TxId &txid,
                                  unsigned int n, bool used)
         EXCLUSIVE_LOCKS_REQUIRED(cs_wallet);
diff --git a/src/wallet/wallet.cpp b/src/wallet/wallet.cpp
--- a/src/wallet/wallet.cpp
+++ b/src/wallet/wallet.cpp
@@ -780,16 +780,25 @@
     }
 }
 
-bool CWallet::IsUsedDestination(const CTxDestination &dst) const {
-    LOCK(cs_wallet);
-    return IsMine(dst) && GetDestData(dst, "used", nullptr);
-}
-
 bool CWallet::IsUsedDestination(const TxId &txid, unsigned int n) const {
+    AssertLockHeld(cs_wallet);
     CTxDestination dst;
     const CWalletTx *srctx = GetWalletTx(txid);
-    return srctx && ExtractDestination(srctx->tx->vout[n].scriptPubKey, dst) &&
-           IsUsedDestination(dst);
+    if (srctx) {
+        assert(srctx->tx->vout.size() > n);
+        LegacyScriptPubKeyMan *spk_man = GetLegacyScriptPubKeyMan();
+        // When descriptor wallets arrive, these additional checks are
+        // likely superfluous and can be optimized out
+        assert(spk_man != nullptr);
+        for (const auto &keyid :
+             GetAffectedKeys(srctx->tx->vout[n].scriptPubKey, *spk_man)) {
+            PKHash pkh_dest(keyid);
+            if (GetDestData(pkh_dest, "used", nullptr)) {
+                return true;
+            }
+        }
+    }
+    return false;
 }
 
 bool CWallet::AddToWallet(const CWalletTx &wtxIn, bool fFlushOnClose) {
diff --git a/test/functional/wallet_avoidreuse.py b/test/functional/wallet_avoidreuse.py
--- a/test/functional/wallet_avoidreuse.py
+++ b/test/functional/wallet_avoidreuse.py
@@ -240,7 +240,7 @@
         '''
         self.log.info("Test fund send fund send")
 
-        fundaddr = self.nodes[1].getnewaddress()
+        fundaddr = self.nodes[1].getnewaddress(label="", address_type="legacy")
         retaddr = self.nodes[0].getnewaddress()
 
         self.nodes[0].sendtoaddress(fundaddr, 10)
@@ -271,7 +271,13 @@
         # getbalances should show no used, 5 BCH trusted
         assert_balances(self.nodes[1], mine={"used": 0, "trusted": 5})
 
-        self.nodes[0].sendtoaddress(fundaddr, 10)
+        # For the second send, we transmute it to a related single-key address
+        # to make sure it's also detected as re-use
+        # NB: this is not very useful for ABC, but we keep the new variable
+        # name for consistency.
+        new_fundaddr = fundaddr
+
+        self.nodes[0].sendtoaddress(new_fundaddr, 10)
         self.nodes[0].generate(1)
         self.sync_all()