diff --git a/programs/client/Client.cpp b/programs/client/Client.cpp
index 25c94c56aa6..39edaf3497e 100644
--- a/programs/client/Client.cpp
+++ b/programs/client/Client.cpp
@@ -1164,6 +1164,9 @@ void Client::processOptions(const OptionsDescription & options_description,
     /// (There is no need to copy the context because clickhouse-client has no background tasks so it won't use that context in parallel.)
     client_context = global_context;
     initClientContext();
+
+    /// Allow to pass-through unknown settings to the server.
+    client_context->getAccessControl().allowAllSettings();
 }
 
 
diff --git a/programs/server/Server.cpp b/programs/server/Server.cpp
index 74228fae5a3..16fee378cf0 100644
--- a/programs/server/Server.cpp
+++ b/programs/server/Server.cpp
@@ -1922,7 +1922,7 @@ try
     auto & access_control = global_context->getAccessControl();
     try
     {
-        access_control.setUpFromMainConfig(config(), config_path, [&] { return global_context->getZooKeeper(); });
+        access_control.setupFromMainConfig(config(), config_path, [&] { return global_context->getZooKeeper(); });
     }
     catch (...)
     {
diff --git a/src/Access/AccessControl.cpp b/src/Access/AccessControl.cpp
index 95a467bbbe5..d4f8c7bc859 100644
--- a/src/Access/AccessControl.cpp
+++ b/src/Access/AccessControl.cpp
@@ -280,7 +280,7 @@ void AccessControl::shutdown()
 }
 
 
-void AccessControl::setUpFromMainConfig(const Poco::Util::AbstractConfiguration & config_, const String & config_path_,
+void AccessControl::setupFromMainConfig(const Poco::Util::AbstractConfiguration & config_, const String & config_path_,
                                         const zkutil::GetZooKeeper & get_zookeeper_function_)
 {
     if (config_.has("custom_settings_prefixes"))
@@ -868,4 +868,10 @@ const ExternalAuthenticators & AccessControl::getExternalAuthenticators() const
     return *external_authenticators;
 }
 
+
+void AccessControl::allowAllSettings()
+{
+    custom_settings_prefixes->registerPrefixes({""});
+}
+
 }
diff --git a/src/Access/AccessControl.h b/src/Access/AccessControl.h
index bfaf256ad48..7d8ee1232d0 100644
--- a/src/Access/AccessControl.h
+++ b/src/Access/AccessControl.h
@@ -57,7 +57,7 @@ public:
     void shutdown() override;
 
     /// Initializes access storage (user directories).
-    void setUpFromMainConfig(const Poco::Util::AbstractConfiguration & config_, const String & config_path_,
+    void setupFromMainConfig(const Poco::Util::AbstractConfiguration & config_, const String & config_path_,
                              const zkutil::GetZooKeeper & get_zookeeper_function_);
 
     /// Parses access entities from a configuration loaded from users.xml.
@@ -238,6 +238,9 @@ public:
     /// Gets manager of notifications.
     AccessChangesNotifier & getChangesNotifier();
 
+    /// Allow all setting names - this can be used in clients to pass-through unknown settings to the server.
+    void allowAllSettings();
+
 private:
     class ContextAccessCache;
     class CustomSettingsPrefixes;
diff --git a/src/Access/SettingsConstraints.cpp b/src/Access/SettingsConstraints.cpp
index a274f6b54f2..7506e365035 100644
--- a/src/Access/SettingsConstraints.cpp
+++ b/src/Access/SettingsConstraints.cpp
@@ -219,8 +219,8 @@ void SettingsConstraints::clamp(const Settings & current_settings, SettingsChang
         });
 }
 
-template <class T>
-bool getNewValueToCheck(const T & current_settings, SettingChange & change, Field & new_value, bool throw_on_failure)
+template <typename SettingsT>
+bool getNewValueToCheck(const SettingsT & current_settings, SettingChange & change, Field & new_value, bool throw_on_failure)
 {
     Field current_value;
     bool has_current_value = current_settings.tryGet(change.name, current_value);
@@ -230,12 +230,12 @@ bool getNewValueToCheck(const T & current_settings, SettingChange & change, Fiel
         return false;
 
     if (throw_on_failure)
-        new_value = T::castValueUtil(change.name, change.value);
+        new_value = SettingsT::castValueUtil(change.name, change.value);
     else
     {
         try
         {
-            new_value = T::castValueUtil(change.name, change.value);
+            new_value = SettingsT::castValueUtil(change.name, change.value);
         }
         catch (...)
         {
diff --git a/src/Client/ClientBase.cpp b/src/Client/ClientBase.cpp
index 01d03006eec..e312f2a8158 100644
--- a/src/Client/ClientBase.cpp
+++ b/src/Client/ClientBase.cpp
@@ -58,6 +58,7 @@
 #include <QueryPipeline/QueryPipelineBuilder.h>
 #include <Interpreters/ReplaceQueryParameterVisitor.h>
 #include <Interpreters/ProfileEventsExt.h>
+#include <Interpreters/InterpreterSetQuery.h>
 #include <IO/WriteBufferFromOStream.h>
 #include <IO/WriteBufferFromFileDescriptor.h>
 #include <IO/CompressionMethod.h>
@@ -1608,14 +1609,14 @@ void ClientBase::sendData(Block & sample, const ColumnsDescription & columns_des
             auto metadata = storage->getInMemoryMetadataPtr();
             QueryPlan plan;
             storage->read(
-                    plan,
-                    sample.getNames(),
-                    storage->getStorageSnapshot(metadata, client_context),
-                    query_info,
-                    client_context,
-                    {},
-                    client_context->getSettingsRef().max_block_size,
-                    getNumberOfPhysicalCPUCores());
+                plan,
+                sample.getNames(),
+                storage->getStorageSnapshot(metadata, client_context),
+                query_info,
+                client_context,
+                {},
+                client_context->getSettingsRef().max_block_size,
+                getNumberOfPhysicalCPUCores());
 
             auto builder = plan.buildQueryPipeline(
                 QueryPlanOptimizationSettings::fromContext(client_context),
@@ -1892,48 +1893,19 @@ void ClientBase::processParsedSingleQuery(const String & full_query, const Strin
     profile_events.watch.restart();
 
     {
-        /// Temporarily apply query settings to context.
-        std::optional<Settings> old_settings;
-        SCOPE_EXIT_SAFE({
-            if (old_settings)
-                client_context->setSettings(*old_settings);
+        /// Temporarily apply query settings to the context.
+        Settings old_settings = client_context->getSettingsCopy();
+        SCOPE_EXIT_SAFE(
+        {
+            client_context->setSettings(old_settings);
         });
-
-        auto apply_query_settings = [&](const IAST & settings_ast)
-        {
-            if (!old_settings)
-                old_settings.emplace(client_context->getSettingsRef());
-            client_context->applySettingsChanges(settings_ast.as<ASTSetQuery>()->changes);
-            client_context->resetSettingsToDefaultValue(settings_ast.as<ASTSetQuery>()->default_settings);
-        };
-
-        const auto * insert = parsed_query->as<ASTInsertQuery>();
-        if (const auto * select = parsed_query->as<ASTSelectQuery>(); select && select->settings())
-            apply_query_settings(*select->settings());
-        else if (const auto * select_with_union = parsed_query->as<ASTSelectWithUnionQuery>())
-        {
-            const ASTs & children = select_with_union->list_of_selects->children;
-            if (!children.empty())
-            {
-                // On the client it is enough to apply settings only for the
-                // last SELECT, since the only thing that is important to apply
-                // on the client is format settings.
-                const auto * last_select = children.back()->as<ASTSelectQuery>();
-                if (last_select && last_select->settings())
-                {
-                    apply_query_settings(*last_select->settings());
-                }
-            }
-        }
-        else if (const auto * query_with_output = parsed_query->as<ASTQueryWithOutput>(); query_with_output && query_with_output->settings_ast)
-            apply_query_settings(*query_with_output->settings_ast);
-        else if (insert && insert->settings_ast)
-            apply_query_settings(*insert->settings_ast);
+        InterpreterSetQuery::applySettingsFromQuery(parsed_query, client_context);
 
         if (!connection->checkConnected(connection_parameters.timeouts))
             connect();
 
         ASTPtr input_function;
+        const auto * insert = parsed_query->as<ASTInsertQuery>();
         if (insert && insert->select)
             insert->tryFindInputFunction(input_function);
 
diff --git a/src/Interpreters/InterpreterSetQuery.cpp b/src/Interpreters/InterpreterSetQuery.cpp
index 7e68fc5c4c1..2ae35c4313b 100644
--- a/src/Interpreters/InterpreterSetQuery.cpp
+++ b/src/Interpreters/InterpreterSetQuery.cpp
@@ -9,6 +9,7 @@
 #include <Parsers/ASTQueryWithOutput.h>
 #include <Parsers/ASTSelectWithUnionQuery.h>
 
+
 namespace DB
 {
 
@@ -45,9 +46,7 @@ static void applySettingsFromSelectWithUnion(const ASTSelectWithUnionQuery & sel
     // It is flattened later, when we process UNION ALL/DISTINCT.
     const auto * last_select = children.back()->as<ASTSelectQuery>();
     if (last_select && last_select->settings())
-    {
-        InterpreterSetQuery(last_select->settings(), context).executeForCurrentContext();
-    }
+        InterpreterSetQuery(last_select->settings(), context).executeForCurrentContext(/* ignore_setting_constraints= */ false);
 }
 
 void InterpreterSetQuery::applySettingsFromQuery(const ASTPtr & ast, ContextMutablePtr context_)
@@ -55,10 +54,20 @@ void InterpreterSetQuery::applySettingsFromQuery(const ASTPtr & ast, ContextMuta
     if (!ast)
         return;
 
+    /// First apply the outermost settings. Then they could be overridden by deeper settings.
+    if (const auto * query_with_output = dynamic_cast<const ASTQueryWithOutput *>(ast.get()))
+    {
+        if (query_with_output->settings_ast)
+            InterpreterSetQuery(query_with_output->settings_ast, context_).executeForCurrentContext(/* ignore_setting_constraints= */ false);
+
+        if (const auto * create_query = ast->as<ASTCreateQuery>(); create_query && create_query->select)
+            applySettingsFromSelectWithUnion(create_query->select->as<ASTSelectWithUnionQuery &>(), context_);
+    }
+
     if (const auto * select_query = ast->as<ASTSelectQuery>())
     {
         if (auto new_settings = select_query->settings())
-            InterpreterSetQuery(new_settings, context_).executeForCurrentContext();
+            InterpreterSetQuery(new_settings, context_).executeForCurrentContext(/* ignore_setting_constraints= */ false);
     }
     else if (const auto * select_with_union_query = ast->as<ASTSelectWithUnionQuery>())
     {
@@ -67,28 +76,15 @@ void InterpreterSetQuery::applySettingsFromQuery(const ASTPtr & ast, ContextMuta
     else if (const auto * explain_query = ast->as<ASTExplainQuery>())
     {
         if (explain_query->settings_ast)
-            InterpreterSetQuery(explain_query->settings_ast, context_).executeForCurrentContext();
+            InterpreterSetQuery(explain_query->settings_ast, context_).executeForCurrentContext(/* ignore_setting_constraints= */ false);
 
         applySettingsFromQuery(explain_query->getExplainedQuery(), context_);
     }
-    else if (const auto * query_with_output = dynamic_cast<const ASTQueryWithOutput *>(ast.get()))
-    {
-        if (query_with_output->settings_ast)
-            InterpreterSetQuery(query_with_output->settings_ast, context_).executeForCurrentContext();
-
-        if (const auto * create_query = ast->as<ASTCreateQuery>())
-        {
-            if (create_query->select)
-            {
-                applySettingsFromSelectWithUnion(create_query->select->as<ASTSelectWithUnionQuery &>(), context_);
-            }
-        }
-    }
     else if (auto * insert_query = ast->as<ASTInsertQuery>())
     {
         context_->setInsertFormat(insert_query->format);
         if (insert_query->settings_ast)
-            InterpreterSetQuery(insert_query->settings_ast, context_).executeForCurrentContext();
+            InterpreterSetQuery(insert_query->settings_ast, context_).executeForCurrentContext(/* ignore_setting_constraints= */ false);
     }
 }
 
diff --git a/src/Interpreters/InterpreterSetQuery.h b/src/Interpreters/InterpreterSetQuery.h
index 2438762f347..f50105c39f4 100644
--- a/src/Interpreters/InterpreterSetQuery.h
+++ b/src/Interpreters/InterpreterSetQuery.h
@@ -23,7 +23,7 @@ public:
     /** Set setting for current context (query context).
       * It is used for interpretation of SETTINGS clause in SELECT query.
       */
-    void executeForCurrentContext(bool ignore_setting_constraints = false);
+    void executeForCurrentContext(bool ignore_setting_constraints);
 
     bool supportsTransactions() const override { return true; }
 
diff --git a/src/Parsers/ParserQueryWithOutput.cpp b/src/Parsers/ParserQueryWithOutput.cpp
index cb0c10cd1c9..ac8f7d560e0 100644
--- a/src/Parsers/ParserQueryWithOutput.cpp
+++ b/src/Parsers/ParserQueryWithOutput.cpp
@@ -25,7 +25,6 @@
 #include <Parsers/ParserTablePropertiesQuery.h>
 #include <Parsers/ParserWatchQuery.h>
 #include <Parsers/ParserDescribeCacheQuery.h>
-#include <Parsers/QueryWithOutputSettingsPushDownVisitor.h>
 #include <Parsers/Access/ParserShowAccessEntitiesQuery.h>
 #include <Parsers/Access/ParserShowAccessQuery.h>
 #include <Parsers/Access/ParserShowCreateAccessEntityQuery.h>
@@ -152,37 +151,55 @@ bool ParserQueryWithOutput::parseImpl(Pos & pos, ASTPtr & node, Expected & expec
 
     }
 
+    /// These two sections are allowed in an arbitrary order.
     ParserKeyword s_format(Keyword::FORMAT);
-
-    if (s_format.ignore(pos, expected))
-    {
-        ParserIdentifier format_p;
-
-        if (!format_p.parse(pos, query_with_output.format, expected))
-            return false;
-        setIdentifierSpecial(query_with_output.format);
-
-        query_with_output.children.push_back(query_with_output.format);
-    }
-
-    // SETTINGS key1 = value1, key2 = value2, ...
     ParserKeyword s_settings(Keyword::SETTINGS);
-    if (!query_with_output.settings_ast && s_settings.ignore(pos, expected))
-    {
-        ParserSetQuery parser_settings(true);
-        if (!parser_settings.parse(pos, query_with_output.settings_ast, expected))
-            return false;
-        query_with_output.children.push_back(query_with_output.settings_ast);
 
-        // SETTINGS after FORMAT is not parsed by the SELECT parser (ParserSelectQuery)
-        // Pass them manually, to apply in InterpreterSelectQuery::initSettings()
-        if (query->as<ASTSelectWithUnionQuery>())
+    /** Why: let's take the following example:
+      * SELECT 1 UNION ALL SELECT 2 FORMAT TSV
+      * Each subquery can be put in parentheses and have its own settings:
+      *   (SELECT 1 SETTINGS a=b) UNION ALL (SELECT 2 SETTINGS c=d) FORMAT TSV
+      * And the whole query can have settings:
+      *   (SELECT 1 SETTINGS a=b) UNION ALL (SELECT 2 SETTINGS c=d) FORMAT TSV SETTINGS e=f
+      * A single query with output is parsed in the same way as the UNION ALL chain:
+      *   SELECT 1 SETTINGS a=b FORMAT TSV SETTINGS e=f
+      * So while these forms have a slightly different meaning, they both exist:
+      *   SELECT 1 SETTINGS a=b FORMAT TSV
+      *   SELECT 1 FORMAT TSV SETTINGS e=f
+      * And due to this effect, the users expect that the FORMAT and SETTINGS may go in an arbitrary order.
+      * But while this work:
+      *   (SELECT 1) UNION ALL (SELECT 2) FORMAT TSV SETTINGS d=f
+      * This does not work automatically, unless we explicitly allow different orders:
+      *   (SELECT 1) UNION ALL (SELECT 2) SETTINGS d=f FORMAT TSV
+      * Inevitably, we also allow this:
+      *   SELECT 1 SETTINGS a=b SETTINGS d=f FORMAT TSV
+      *   ^^^^^^^^^^^^^^^^^^^^^
+      * Because this part is consumed into ASTSelectWithUnionQuery
+      * and the rest into ASTQueryWithOutput.
+      */
+
+    for (size_t i = 0; i < 2; ++i)
+    {
+        if (!query_with_output.format && s_format.ignore(pos, expected))
         {
-            auto settings = query_with_output.settings_ast->clone();
-            assert_cast<ASTSetQuery *>(settings.get())->print_in_format = false;
-            QueryWithOutputSettingsPushDownVisitor::Data data{settings};
-            QueryWithOutputSettingsPushDownVisitor(data).visit(query);
+            ParserIdentifier format_p;
+
+            if (!format_p.parse(pos, query_with_output.format, expected))
+                return false;
+            setIdentifierSpecial(query_with_output.format);
+
+            query_with_output.children.push_back(query_with_output.format);
         }
+        else if (!query_with_output.settings_ast && s_settings.ignore(pos, expected))
+        {
+            // SETTINGS key1 = value1, key2 = value2, ...
+            ParserSetQuery parser_settings(true);
+            if (!parser_settings.parse(pos, query_with_output.settings_ast, expected))
+                return false;
+            query_with_output.children.push_back(query_with_output.settings_ast);
+        }
+        else
+            break;
     }
 
     node = std::move(query);
diff --git a/src/Parsers/QueryWithOutputSettingsPushDownVisitor.cpp b/src/Parsers/QueryWithOutputSettingsPushDownVisitor.cpp
deleted file mode 100644
index 8cf0d0063ae..00000000000
--- a/src/Parsers/QueryWithOutputSettingsPushDownVisitor.cpp
+++ /dev/null
@@ -1,56 +0,0 @@
-#include <Common/SettingsChanges.h>
-#include <Parsers/QueryWithOutputSettingsPushDownVisitor.h>
-#include <Parsers/ASTSelectWithUnionQuery.h>
-#include <Parsers/ASTSelectQuery.h>
-#include <Parsers/ASTSetQuery.h>
-#include <Parsers/ASTSubquery.h>
-
-#include <iterator>
-#include <algorithm>
-
-namespace DB
-{
-
-bool QueryWithOutputSettingsPushDownMatcher::needChildVisit(ASTPtr & node, const ASTPtr & child)
-{
-    if (node->as<ASTSelectWithUnionQuery>())
-        return true;
-    if (node->as<ASTSubquery>())
-        return true;
-    if (child->as<ASTSelectQuery>())
-        return true;
-    return false;
-}
-
-void QueryWithOutputSettingsPushDownMatcher::visit(ASTPtr & ast, Data & data)
-{
-    if (auto * select_query = ast->as<ASTSelectQuery>())
-        visit(*select_query, ast, data);
-}
-
-void QueryWithOutputSettingsPushDownMatcher::visit(ASTSelectQuery & select_query, ASTPtr &, Data & data)
-{
-    ASTPtr select_settings_ast = select_query.settings();
-    if (!select_settings_ast)
-    {
-        select_query.setExpression(ASTSelectQuery::Expression::SETTINGS, data.settings_ast->clone());
-        return;
-    }
-
-    SettingsChanges & select_settings = select_settings_ast->as<ASTSetQuery &>().changes;
-    SettingsChanges & settings = data.settings_ast->as<ASTSetQuery &>().changes;
-
-    for (auto & setting : settings)
-    {
-        auto it = std::find_if(select_settings.begin(), select_settings.end(), [&](auto & select_setting)
-        {
-            return select_setting.name == setting.name;
-        });
-        if (it == select_settings.end())
-            select_settings.push_back(setting);
-        else
-            it->value = setting.value;
-    }
-}
-
-}
diff --git a/src/Parsers/QueryWithOutputSettingsPushDownVisitor.h b/src/Parsers/QueryWithOutputSettingsPushDownVisitor.h
deleted file mode 100644
index fde8a07b555..00000000000
--- a/src/Parsers/QueryWithOutputSettingsPushDownVisitor.h
+++ /dev/null
@@ -1,39 +0,0 @@
-#pragma once
-
-#include <Parsers/IAST.h>
-#include <Interpreters/InDepthNodeVisitor.h>
-
-namespace DB
-{
-
-class ASTSelectQuery;
-struct SettingChange;
-class SettingsChanges;
-
-/// Pushdown SETTINGS clause that goes after FORMAT to the SELECT query:
-/// (since settings after FORMAT parsed separately not in the ParserSelectQuery but in ParserQueryWithOutput)
-///
-///     SELECT 1                             FORMAT Null SETTINGS max_block_size = 1 ->
-///     SELECT 1 SETTINGS max_block_size = 1 FORMAT Null SETTINGS max_block_size = 1
-///
-/// Otherwise settings after FORMAT will not be applied.
-class QueryWithOutputSettingsPushDownMatcher
-{
-public:
-    using Visitor = InDepthNodeVisitor<QueryWithOutputSettingsPushDownMatcher, true>;
-
-    struct Data
-    {
-        const ASTPtr & settings_ast;
-    };
-
-    static bool needChildVisit(ASTPtr & node, const ASTPtr & child);
-    static void visit(ASTPtr & ast, Data & data);
-
-private:
-    static void visit(ASTSelectQuery &, ASTPtr &, Data &);
-};
-
-using QueryWithOutputSettingsPushDownVisitor = QueryWithOutputSettingsPushDownMatcher::Visitor;
-
-}
diff --git a/tests/queries/0_stateless/00857_global_joinsavel_table_alias.sql b/tests/queries/0_stateless/00857_global_joinsavel_table_alias.sql
index 2044a9b8d22..092b071cb48 100644
--- a/tests/queries/0_stateless/00857_global_joinsavel_table_alias.sql
+++ b/tests/queries/0_stateless/00857_global_joinsavel_table_alias.sql
@@ -1,4 +1,3 @@
-
 DROP TABLE IF EXISTS local_table;
 DROP TABLE IF EXISTS other_table;
 
diff --git a/tests/queries/0_stateless/01401_FORMAT_SETTINGS.reference b/tests/queries/0_stateless/01401_FORMAT_SETTINGS.reference
index 22405bf1866..a8b99666654 100644
--- a/tests/queries/0_stateless/01401_FORMAT_SETTINGS.reference
+++ b/tests/queries/0_stateless/01401_FORMAT_SETTINGS.reference
@@ -1,7 +1,7 @@
 1
 1
 1
-1
-1
+2
+1
 2
 2
diff --git a/tests/queries/0_stateless/01401_FORMAT_SETTINGS.sh b/tests/queries/0_stateless/01401_FORMAT_SETTINGS.sh
index b70c28422c9..173cc949500 100755
--- a/tests/queries/0_stateless/01401_FORMAT_SETTINGS.sh
+++ b/tests/queries/0_stateless/01401_FORMAT_SETTINGS.sh
@@ -13,7 +13,7 @@ ${CLICKHOUSE_CURL} -sS "${CLICKHOUSE_URL}" -d 'SELECT DISTINCT blockSize() FROM
 ${CLICKHOUSE_CURL} -sS "${CLICKHOUSE_URL}" -d 'SELECT DISTINCT blockSize() FROM numbers(2) FORMAT CSV SETTINGS max_block_size = 1'
 # push down append
 ${CLICKHOUSE_CURL} -sS "${CLICKHOUSE_URL}" -d 'SELECT DISTINCT blockSize() FROM numbers(2) SETTINGS max_compress_block_size = 1 FORMAT CSV SETTINGS max_block_size = 1'
-# overwrite on push down (since these settings goes latest)
+# not overwrite on push down
 ${CLICKHOUSE_CURL} -sS "${CLICKHOUSE_URL}" -d 'SELECT DISTINCT blockSize() FROM numbers(2) SETTINGS max_block_size = 2 FORMAT CSV SETTINGS max_block_size = 1'
 # on push-down
 ${CLICKHOUSE_CURL} -sS "${CLICKHOUSE_URL}" -d 'SELECT DISTINCT blockSize() FROM numbers(2) SETTINGS max_block_size = 1 FORMAT CSV'
diff --git a/tests/queries/0_stateless/03003_compatibility_setting_bad_value.sql b/tests/queries/0_stateless/03003_compatibility_setting_bad_value.sql
index 48e98798c51..3a09eec7452 100644
--- a/tests/queries/0_stateless/03003_compatibility_setting_bad_value.sql
+++ b/tests/queries/0_stateless/03003_compatibility_setting_bad_value.sql
@@ -1,2 +1 @@
-select 42 settings compatibility=NULL;  -- {clientError BAD_ARGUMENTS}
-
+select 42 settings compatibility=NULL;  -- {clientError BAD_GET}
diff --git a/tests/queries/0_stateless/03172_format_settings_clauses.reference b/tests/queries/0_stateless/03172_format_settings_clauses.reference
new file mode 100644
index 00000000000..8a98b137f4b
--- /dev/null
+++ b/tests/queries/0_stateless/03172_format_settings_clauses.reference
@@ -0,0 +1,14 @@
+1
+2
+1
+2
+1
+2
+1
+1
+3
+3
+3
+3
+3
+1
diff --git a/tests/queries/0_stateless/03172_format_settings_clauses.sql b/tests/queries/0_stateless/03172_format_settings_clauses.sql
new file mode 100644
index 00000000000..0d1aa4dcfbb
--- /dev/null
+++ b/tests/queries/0_stateless/03172_format_settings_clauses.sql
@@ -0,0 +1,30 @@
+SET max_block_size = 10, max_threads = 1;
+
+-- Take the following example:
+SELECT 1 UNION ALL SELECT 2 FORMAT TSV;
+
+-- Each subquery can be put in parentheses and have its own settings:
+(SELECT getSetting('max_block_size') SETTINGS max_block_size = 1) UNION ALL (SELECT getSetting('max_block_size') SETTINGS max_block_size = 2) FORMAT TSV;
+
+-- And the whole query can have settings:
+(SELECT getSetting('max_block_size') SETTINGS max_block_size = 1) UNION ALL (SELECT getSetting('max_block_size') SETTINGS max_block_size = 2) FORMAT TSV SETTINGS max_block_size = 3;
+
+-- A single query with output is parsed in the same way as the UNION ALL chain:
+SELECT getSetting('max_block_size') SETTINGS max_block_size = 1 FORMAT TSV SETTINGS max_block_size = 3;
+
+-- So while these forms have a slightly different meaning, they both exist:
+SELECT getSetting('max_block_size') SETTINGS max_block_size = 1 FORMAT TSV;
+SELECT getSetting('max_block_size') FORMAT TSV SETTINGS max_block_size = 3;
+
+-- And due to this effect, the users expect that the FORMAT and SETTINGS may go in an arbitrary order.
+-- But while this work:
+(SELECT getSetting('max_block_size')) UNION ALL (SELECT getSetting('max_block_size')) FORMAT TSV SETTINGS max_block_size = 3;
+
+-- This does not work automatically, unless we explicitly allow different orders:
+(SELECT getSetting('max_block_size')) UNION ALL (SELECT getSetting('max_block_size')) SETTINGS max_block_size = 3 FORMAT TSV;
+
+-- Inevitably, we allow this:
+SELECT getSetting('max_block_size') SETTINGS max_block_size = 1 SETTINGS max_block_size = 3 FORMAT TSV;
+/*^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^*/
+-- Because this part is consumed into ASTSelectWithUnionQuery
+-- and the rest into ASTQueryWithOutput.