diff --git a/flang/lib/Optimizer/Transforms/AddAliasTags.cpp b/flang/lib/Optimizer/Transforms/AddAliasTags.cpp
index 5cfbdc33285f9..4e788f75d9d77 100644
--- a/flang/lib/Optimizer/Transforms/AddAliasTags.cpp
+++ b/flang/lib/Optimizer/Transforms/AddAliasTags.cpp
@@ -73,7 +73,12 @@ class PassState {
   }
 
   void processFunctionScopes(mlir::func::FuncOp func);
-  fir::DummyScopeOp getDeclarationScope(fir::DeclareOp declareOp);
+  // For the given fir.declare returns the dominating fir.dummy_scope
+  // operation.
+  fir::DummyScopeOp getDeclarationScope(fir::DeclareOp declareOp) const;
+  // For the given fir.declare returns the outermost fir.dummy_scope
+  // in the current function.
+  fir::DummyScopeOp getOutermostScope(fir::DeclareOp declareOp) const;
 
 private:
   mlir::DominanceInfo &domInfo;
@@ -119,9 +124,8 @@ void PassState::processFunctionScopes(mlir::func::FuncOp func) {
   }
 }
 
-// For the given fir.declare returns the dominating fir.dummy_scope
-// operation.
-fir::DummyScopeOp PassState::getDeclarationScope(fir::DeclareOp declareOp) {
+fir::DummyScopeOp
+PassState::getDeclarationScope(fir::DeclareOp declareOp) const {
   auto func = declareOp->getParentOfType<mlir::func::FuncOp>();
   assert(func && "fir.declare does not have parent func.func");
   auto &scopeOps = sortedScopeOperations.at(func);
@@ -132,6 +136,15 @@ fir::DummyScopeOp PassState::getDeclarationScope(fir::DeclareOp declareOp) {
   return nullptr;
 }
 
+fir::DummyScopeOp PassState::getOutermostScope(fir::DeclareOp declareOp) const {
+  auto func = declareOp->getParentOfType<mlir::func::FuncOp>();
+  assert(func && "fir.declare does not have parent func.func");
+  auto &scopeOps = sortedScopeOperations.at(func);
+  if (!scopeOps.empty())
+    return scopeOps[0];
+  return nullptr;
+}
+
 class AddAliasTagsPass : public fir::impl::AddAliasTagsBase<AddAliasTagsPass> {
 public:
   void runOnOperation() override;
@@ -279,6 +292,15 @@ void AddAliasTagsPass::runOnAliasInterface(fir::FirAliasTagOpInterface op,
     else
       unknownAllocOp = true;
 
+    if (auto declOp = source.origin.instantiationPoint) {
+      // Use the outermost scope for local allocations,
+      // because using the innermost scope may result
+      // in incorrect TBAA, when calls are inlined in MLIR.
+      auto declareOp = mlir::dyn_cast<fir::DeclareOp>(declOp);
+      assert(declareOp && "Instantiation point must be fir.declare");
+      scopeOp = state.getOutermostScope(declareOp);
+    }
+
     if (unknownAllocOp) {
       LLVM_DEBUG(llvm::dbgs().indent(2)
                  << "WARN: unknown defining op for SourceKind::Allocate " << *op
diff --git a/flang/test/Transforms/tbaa-for-local-vars.fir b/flang/test/Transforms/tbaa-for-local-vars.fir
new file mode 100644
index 0000000000000..82058ffef290a
--- /dev/null
+++ b/flang/test/Transforms/tbaa-for-local-vars.fir
@@ -0,0 +1,92 @@
+// Test TBAA tags assignment for access off the fir.declare
+// placed in the middle of the routine (e.g. a temporary).
+// Original example:
+// module m
+//   type t
+//      real :: x
+//   end type t
+// contains
+//   subroutine bar(this)
+//     class(t), intent(out) :: this
+//     this%x = 1.0
+//   end subroutine bar
+//   function foo() result(res)
+//     type(t) :: res
+//     call bar(res)
+//   end function foo
+//   subroutine test(arg)
+//     type(t) :: var
+//     var = foo()
+//     arg = var%x
+//   end subroutine test
+// end module m
+//
+// The calls were manually inlined in FIR with fir.save_result's
+// destination operand being used instead of the temporary
+// alloca of the result inside foo. Runtime calls were removed
+// to reduce the test.
+// The temporary function result fir.declare is then dominated
+// by fir.dummy_scope of the foo function. If we use this scope
+// to assign the TBAA local-alloc tag to the accesses of
+// the temporary, then it won't conflict with the TBAA dummy tag
+// assigned to the accesses of this argument of bar.
+// That would be incorrect, because they access the same memory.
+// Check that the local-alloc tag is placed into the outermost
+// scope's TBAA tree.
+// RUN: fir-opt --fir-add-alias-tags %s | FileCheck %s
+
+// CHECK: #[[$ATTR_0:.+]] = #llvm.tbaa_root<id = "Flang function root _QMmPtest - Scope 2">
+// CHECK: #[[$ATTR_1:.+]] = #llvm.tbaa_root<id = "Flang function root _QMmPtest">
+// CHECK: #[[$ATTR_2:.+]] = #llvm.tbaa_type_desc<id = "any access", members = {<#[[$ATTR_0]], 0>}>
+// CHECK: #[[$ATTR_3:.+]] = #llvm.tbaa_type_desc<id = "any access", members = {<#[[$ATTR_1]], 0>}>
+// CHECK: #[[$ATTR_4:.+]] = #llvm.tbaa_type_desc<id = "any data access", members = {<#[[$ATTR_2]], 0>}>
+// CHECK: #[[$ATTR_5:.+]] = #llvm.tbaa_type_desc<id = "any data access", members = {<#[[$ATTR_3]], 0>}>
+// CHECK: #[[$ATTR_6:.+]] = #llvm.tbaa_type_desc<id = "dummy arg data", members = {<#[[$ATTR_4]], 0>}>
+// CHECK: #[[$ATTR_7:.+]] = #llvm.tbaa_type_desc<id = "target data", members = {<#[[$ATTR_5]], 0>}>
+// CHECK: #[[$ATTR_9:.+]] = #llvm.tbaa_type_desc<id = "dummy arg data/_QMmFbarEthis", members = {<#[[$ATTR_6]], 0>}>
+// CHECK: #[[$ATTR_10:.+]] = #llvm.tbaa_type_desc<id = "allocated data", members = {<#[[$ATTR_7]], 0>}>
+// CHECK: #[[$ATTR_12:.+]] = #llvm.tbaa_tag<base_type = #[[$ATTR_9]], access_type = #[[$ATTR_9]], offset = 0>
+// CHECK: #[[$ATTR_13:.+]] = #llvm.tbaa_tag<base_type = #[[$ATTR_10]], access_type = #[[$ATTR_10]], offset = 0>
+
+// CHECK-LABEL:   func.func @_QMmPtest(
+// CHECK-SAME:      %[[ARG0:.*]]: !fir.ref<f32> {fir.bindc_name = "arg"}) {
+// CHECK:           %[[VAL_0:.*]] = arith.constant 1.000000e+00 : f32
+// CHECK:           %[[VAL_1:.*]] = fir.alloca !fir.type<_QMmTt{x:f32}> {bindc_name = ".result"}
+// CHECK:           %[[VAL_2:.*]] = fir.dummy_scope : !fir.dscope
+// CHECK:           %[[VAL_3:.*]] = fir.declare %[[ARG0]] dummy_scope %[[VAL_2]] {uniq_name = "_QMmFtestEarg"} : (!fir.ref<f32>, !fir.dscope) -> !fir.ref<f32>
+// CHECK:           %[[VAL_6:.*]] = fir.dummy_scope : !fir.dscope
+// CHECK:           %[[VAL_7:.*]] = fir.declare %[[VAL_1]] {uniq_name = "_QMmFfooEres"} : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<!fir.type<_QMmTt{x:f32}>>
+// CHECK:           %[[VAL_8:.*]] = fir.embox %[[VAL_7]] : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.box<!fir.type<_QMmTt{x:f32}>>
+// CHECK:           %[[VAL_9:.*]] = fir.convert %[[VAL_8]] : (!fir.box<!fir.type<_QMmTt{x:f32}>>) -> !fir.class<!fir.type<_QMmTt{x:f32}>>
+// CHECK:           %[[VAL_10:.*]] = fir.dummy_scope : !fir.dscope
+// CHECK:           %[[VAL_11:.*]] = fir.declare %[[VAL_9]] dummy_scope %[[VAL_10]] {fortran_attrs = #fir.var_attrs<intent_out>, uniq_name = "_QMmFbarEthis"} : (!fir.class<!fir.type<_QMmTt{x:f32}>>, !fir.dscope) -> !fir.class<!fir.type<_QMmTt{x:f32}>>
+// CHECK:           %[[VAL_12:.*]] = fir.coordinate_of %[[VAL_11]], x : (!fir.class<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<f32>
+// CHECK:           fir.store %[[VAL_0]] to %[[VAL_12]] {tbaa = [#[[$ATTR_12]]]} : !fir.ref<f32>
+// CHECK:           %[[VAL_13:.*]] = fir.declare %[[VAL_1]] {uniq_name = ".tmp.func_result"} : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<!fir.type<_QMmTt{x:f32}>>
+// CHECK:           %[[VAL_14:.*]] = fir.coordinate_of %[[VAL_13]], x : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<f32>
+// CHECK:           %[[VAL_16:.*]] = fir.load %[[VAL_14]] {tbaa = [#[[$ATTR_13]]]} : !fir.ref<f32>
+func.func @_QMmPtest(%arg0: !fir.ref<f32> {fir.bindc_name = "arg"}) {
+  %cst = arith.constant 1.000000e+00 : f32
+  %0 = fir.alloca !fir.type<_QMmTt{x:f32}> {bindc_name = ".result"}
+  %1 = fir.dummy_scope : !fir.dscope
+  %2 = fir.declare %arg0 dummy_scope %1 {uniq_name = "_QMmFtestEarg"} : (!fir.ref<f32>, !fir.dscope) -> !fir.ref<f32>
+  %3 = fir.alloca !fir.type<_QMmTt{x:f32}> {bindc_name = "var", uniq_name = "_QMmFtestEvar"}
+  %4 = fir.declare %3 {uniq_name = "_QMmFtestEvar"} : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<!fir.type<_QMmTt{x:f32}>>
+  %5 = fir.dummy_scope : !fir.dscope
+  %6 = fir.declare %0 {uniq_name = "_QMmFfooEres"} : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<!fir.type<_QMmTt{x:f32}>>
+  %7 = fir.embox %6 : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.box<!fir.type<_QMmTt{x:f32}>>
+  %8 = fir.convert %7 : (!fir.box<!fir.type<_QMmTt{x:f32}>>) -> !fir.class<!fir.type<_QMmTt{x:f32}>>
+  %9 = fir.dummy_scope : !fir.dscope
+  %10 = fir.declare %8 dummy_scope %9 {fortran_attrs = #fir.var_attrs<intent_out>, uniq_name = "_QMmFbarEthis"} : (!fir.class<!fir.type<_QMmTt{x:f32}>>, !fir.dscope) -> !fir.class<!fir.type<_QMmTt{x:f32}>>
+  %14 = fir.coordinate_of %10, x : (!fir.class<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<f32>
+  fir.store %cst to %14 : !fir.ref<f32>
+  %15 = fir.declare %0 {uniq_name = ".tmp.func_result"} : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<!fir.type<_QMmTt{x:f32}>>
+  %16 = fir.coordinate_of %15, x : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<f32>
+  %17 = fir.coordinate_of %4, x : (!fir.ref<!fir.type<_QMmTt{x:f32}>>) -> !fir.ref<f32>
+  %18 = fir.load %16 : !fir.ref<f32>
+  fir.store %18 to %17 : !fir.ref<f32>
+  %19 = fir.load %17 : !fir.ref<f32>
+  fir.store %19 to %2 : !fir.ref<f32>
+  return
+}
+
diff --git a/flang/test/Transforms/tbaa-with-dummy-scope2.fir b/flang/test/Transforms/tbaa-with-dummy-scope2.fir
index 249471de458d3..fd711a4d70eb4 100644
--- a/flang/test/Transforms/tbaa-with-dummy-scope2.fir
+++ b/flang/test/Transforms/tbaa-with-dummy-scope2.fir
@@ -84,18 +84,17 @@ func.func @_QPtest2() attributes {noinline} {
   fir.store %c2_i32 to %2 : !fir.ref<i32>
   return
 }
-// CHECK: #[[$ATTR_0:.+]] = #llvm.tbaa_root<id = "Flang function root _QPtest2 - Scope 1">
-// CHECK: #[[$ATTR_1:.+]] = #llvm.tbaa_root<id = "Flang function root _QPtest2">
+// CHECK: #[[$ATTR_0:.+]] = #llvm.tbaa_root<id = "Flang function root _QPtest2">
+// CHECK: #[[$ATTR_1:.+]] = #llvm.tbaa_root<id = "Flang function root _QPtest2 - Scope 1">
 // CHECK: #[[$ATTR_2:.+]] = #llvm.tbaa_type_desc<id = "any access", members = {<#[[$ATTR_0]], 0>}>
 // CHECK: #[[$ATTR_3:.+]] = #llvm.tbaa_type_desc<id = "any access", members = {<#[[$ATTR_1]], 0>}>
 // CHECK: #[[$ATTR_4:.+]] = #llvm.tbaa_type_desc<id = "any data access", members = {<#[[$ATTR_2]], 0>}>
 // CHECK: #[[$ATTR_5:.+]] = #llvm.tbaa_type_desc<id = "any data access", members = {<#[[$ATTR_3]], 0>}>
 // CHECK: #[[$TARGETDATA_0:.+]] = #llvm.tbaa_type_desc<id = "target data", members = {<#[[$ATTR_4]], 0>}>
-// CHECK: #[[$ATTR_6:.+]] = #llvm.tbaa_type_desc<id = "dummy arg data", members = {<#[[$ATTR_4]], 0>}>
-// CHECK: #[[$TARGETDATA_1:.+]] = #llvm.tbaa_type_desc<id = "target data", members = {<#[[$ATTR_5]], 0>}>
+// CHECK: #[[$ATTR_6:.+]] = #llvm.tbaa_type_desc<id = "dummy arg data", members = {<#[[$ATTR_5]], 0>}>
 // CHECK: #[[$LOCAL_ATTR_0:.+]] = #llvm.tbaa_type_desc<id = "allocated data", members = {<#[[$TARGETDATA_0]], 0>}>
 // CHECK: #[[$ATTR_8:.+]] = #llvm.tbaa_type_desc<id = "dummy arg data/_QFtest2FinnerEx", members = {<#[[$ATTR_6]], 0>}>
-// CHECK: #[[$ATTR_7:.+]] = #llvm.tbaa_type_desc<id = "global data", members = {<#[[$TARGETDATA_1]], 0>}>
+// CHECK: #[[$ATTR_7:.+]] = #llvm.tbaa_type_desc<id = "global data", members = {<#[[$TARGETDATA_0]], 0>}>
 // CHECK: #[[$ATTR_10:.+]] = #llvm.tbaa_tag<base_type = #[[$ATTR_8]], access_type = #[[$ATTR_8]], offset = 0>
 // CHECK: #[[$LOCAL_ATTR_1:.+]] = #llvm.tbaa_type_desc<id = "allocated data/_QFtest2FinnerEy", members = {<#[[$LOCAL_ATTR_0]], 0>}>
 // CHECK: #[[$ATTR_9:.+]] = #llvm.tbaa_type_desc<id = "global data/_QMmEglob", members = {<#[[$ATTR_7]], 0>}>