diff --git a/ksqldb-engine/src/main/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjector.java b/ksqldb-engine/src/main/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjector.java
index 7633198e65f8..7e585c3a9689 100644
--- a/ksqldb-engine/src/main/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjector.java
+++ b/ksqldb-engine/src/main/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjector.java
@@ -110,7 +110,7 @@ private void registerSchema(
       final FormatInfo formatInfo,
       final KsqlConfig config,
       final String statementText,
-      final boolean overwriteExisting
+      final boolean registerIfSchemaExists
   ) {
     final Format format = FormatFactory.of(formatInfo);
     if (!format.supportsSchemaInference()) {
@@ -125,16 +125,7 @@ private void registerSchema(
         final ParsedSchema parsedSchema =
             format.toParsedSchema(schema.withoutPseudoAndKeyColsInValue().value(), formatInfo);
 
-        if (!overwriteExisting && srClient.getAllSubjects().contains(subject)) {
-          if (!srClient.testCompatibility(subject, parsedSchema)) {
-            throw new KsqlStatementException(
-                String.format(
-                    "Could not register schema for subject "
-                        + "'%s' because it is incompatible with existing schema.",
-                    subject),
-                statementText);
-          }
-        } else {
+        if (registerIfSchemaExists || !srClient.getAllSubjects().contains(subject)) {
           srClient.register(subject, parsedSchema);
         }
       } catch (IOException | RestClientException e) {
diff --git a/ksqldb-engine/src/test/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjectorTest.java b/ksqldb-engine/src/test/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjectorTest.java
index f1d5b26a6934..c30c1d1f12b4 100644
--- a/ksqldb-engine/src/test/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjectorTest.java
+++ b/ksqldb-engine/src/test/java/io/confluent/ksql/schema/ksql/inference/SchemaRegisterInjectorTest.java
@@ -23,6 +23,7 @@
 import static org.mockito.ArgumentMatchers.any;
 import static org.mockito.ArgumentMatchers.anyString;
 import static org.mockito.ArgumentMatchers.eq;
+import static org.mockito.Mockito.never;
 import static org.mockito.Mockito.verify;
 import static org.mockito.Mockito.verifyNoMoreInteractions;
 import static org.mockito.Mockito.when;
@@ -63,6 +64,7 @@
 import java.io.IOException;
 import java.util.HashMap;
 import java.util.Optional;
+import org.apache.avro.Schema;
 import org.junit.Before;
 import org.junit.Test;
 import org.junit.runner.RunWith;
@@ -167,7 +169,7 @@ public void shouldNotRegisterSchemaForSchemaRegistryDisabledFormatCreateSource()
   }
 
   @Test
-  public void shouldRegisterSchemaForSchemaRegistryEnabledFormatCreateSource()
+  public void shouldRegisterSchemaForSchemaRegistryEnabledFormatCreateSourceIfSubjectDoesntExist()
       throws IOException, RestClientException {
     // Given:
     givenStatement("CREATE STREAM sink (f1 VARCHAR) WITH (kafka_topic='expectedName', value_format='AVRO', partitions=1);");
@@ -179,6 +181,7 @@ public void shouldRegisterSchemaForSchemaRegistryEnabledFormatCreateSource()
     verify(schemaRegistryClient).register("expectedName-value", AVRO_SCHEMA);
   }
 
+  @SuppressWarnings("deprecation") // make sure deprecated method is not called
   @Test
   public void shouldNotReplaceExistingSchemaForSchemaRegistryEnabledFormatCreateSource()
       throws IOException, RestClientException {
@@ -191,24 +194,8 @@ public void shouldNotReplaceExistingSchemaForSchemaRegistryEnabledFormatCreateSo
     injector.inject(statement);
 
     // Then:
-    verify(schemaRegistryClient).getAllSubjects();
-    verify(schemaRegistryClient).testCompatibility(eq("expectedName-value"), any(ParsedSchema.class));
-    verifyNoMoreInteractions(schemaRegistryClient);
-  }
-
-  @Test
-  public void shouldThrowOnExistingSchemaForSchemaRegistryEnabledFormatCreateSourceIncompatible()
-      throws IOException, RestClientException {
-    // Given:
-    givenStatement("CREATE STREAM sink (f1 VARCHAR) WITH (kafka_topic='expectedName', value_format='AVRO', partitions=1);");
-    when(schemaRegistryClient.getAllSubjects()).thenReturn(ImmutableSet.of("expectedName-value"));
-    when(schemaRegistryClient.testCompatibility(eq("expectedName-value"), any(ParsedSchema.class))).thenReturn(false);
-
-    // When:
-    final KsqlStatementException e = assertThrows(KsqlStatementException.class, () -> injector.inject(statement));
-
-    // Then:
-    assertThat(e.getMessage(), containsString("Could not register schema for subject 'expectedName-value' because it is incompatible with existing schema."));
+    verify(schemaRegistryClient, never()).register(any(), any(ParsedSchema.class));
+    verify(schemaRegistryClient, never()).register(any(), any(Schema.class));
   }
 
   @Test