diff --git a/Examples/polymorphism/polymorphism-3.1.0.yaml b/Examples/polymorphism/polymorphism-3.1.0.yaml
index 7e43d558b..07413a1aa 100644
--- a/Examples/polymorphism/polymorphism-3.1.0.yaml
+++ b/Examples/polymorphism/polymorphism-3.1.0.yaml
@@ -45,6 +45,7 @@ components:
         -
           $ref: '#/components/schemas/EmployeeResponsible'
     EmployeeResponsible:
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Responsible'
@@ -56,6 +57,7 @@ components:
               type: string
               const: Virtual
     FlResponsible:
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Responsible'
diff --git a/Examples/polymorphism/polymorphism.yaml b/Examples/polymorphism/polymorphism.yaml
index 60b2d349d..606f41383 100644
--- a/Examples/polymorphism/polymorphism.yaml
+++ b/Examples/polymorphism/polymorphism.yaml
@@ -46,6 +46,7 @@ components:
         -
           $ref: '#/components/schemas/EmployeeResponsible'
     EmployeeResponsible:
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Responsible'
@@ -59,6 +60,7 @@ components:
               enum:
                 - Virtual
     FlResponsible:
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Responsible'
diff --git a/Examples/using-interfaces/using-interfaces.yaml b/Examples/using-interfaces/using-interfaces.yaml
index ad616de42..2ea4715f3 100644
--- a/Examples/using-interfaces/using-interfaces.yaml
+++ b/Examples/using-interfaces/using-interfaces.yaml
@@ -67,6 +67,7 @@ components:
               example: blue
     Product:
       title: 'Product model'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/ProductInterface'
diff --git a/Examples/using-traits/using-traits.yaml b/Examples/using-traits/using-traits.yaml
index cb7fa2c20..b13f664d7 100644
--- a/Examples/using-traits/using-traits.yaml
+++ b/Examples/using-traits/using-traits.yaml
@@ -46,6 +46,7 @@ components:
   schemas:
     BellsAndWhistles:
       title: 'Bells and Whistles trait'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Bells'
@@ -86,6 +87,7 @@ components:
       type: object
     Product:
       title: 'Product model'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Colour'
@@ -103,6 +105,7 @@ components:
               example: gong
     SimpleProduct:
       title: 'SimpleProduct model'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/Bells'
@@ -115,6 +118,7 @@ components:
               example: 1
     TrickyProduct:
       title: 'TrickyProduct model'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/SimpleProduct'
diff --git a/src/Processors/AugmentSchemas.php b/src/Processors/AugmentSchemas.php
index c7e03db09..d126bc280 100644
--- a/src/Processors/AugmentSchemas.php
+++ b/src/Processors/AugmentSchemas.php
@@ -57,28 +57,6 @@ public function __invoke(Analysis $analysis)
                             continue;
                         }
 
-                        if (!Generator::isDefault($annotation->allOf)) {
-                            $schema = null;
-                            foreach ($annotation->allOf as $nestedSchema) {
-                                if (!Generator::isDefault($nestedSchema->ref)) {
-                                    continue;
-                                }
-
-                                $schema = $nestedSchema;
-                            }
-
-                            if ($schema === null) {
-                                $schema = new OA\Schema([
-                                    '_context' => new Context(['generated' => true], $annotation->_context),
-                                ]);
-                                $analysis->addAnnotation($schema, $schema->_context);
-                                $annotation->allOf[] = $schema;
-                            }
-
-                            $schema->merge([$property], true);
-                            break;
-                        }
-
                         $annotation->merge([$property], true);
                         break;
                     }
diff --git a/src/Processors/Concerns/MergePropertiesTrait.php b/src/Processors/Concerns/MergePropertiesTrait.php
index aa46132bf..86748d8d1 100644
--- a/src/Processors/Concerns/MergePropertiesTrait.php
+++ b/src/Processors/Concerns/MergePropertiesTrait.php
@@ -35,21 +35,11 @@ protected function inheritFrom(Analysis $analysis, OA\Schema $schema, OA\Schema
         $analysis->addAnnotation($refSchema, $refSchema->_context);
     }
 
-    protected function mergeAnnotations(OA\Schema $schema, array $annotations, array &$existing): void
-    {
-        foreach ($annotations as $annotation) {
-            if ($annotation instanceof OA\Property && !in_array($annotation->_context->property, $existing, true)) {
-                $existing[] = $annotation->_context->property;
-                $schema->merge([$annotation], true);
-            }
-        }
-    }
-
     protected function mergeProperties(OA\Schema $schema, array $from, array &$existing): void
     {
-        foreach ($from['properties'] as $method) {
-            if (is_iterable($method->annotations)) {
-                foreach ($method->annotations as $annotation) {
+        foreach ($from['properties'] as $context) {
+            if (is_iterable($context->annotations)) {
+                foreach ($context->annotations as $annotation) {
                     if ($annotation instanceof OA\Property && !in_array($annotation->_context->property, $existing, true)) {
                         $existing[] = $annotation->_context->property;
                         $schema->merge([$annotation], true);
@@ -61,9 +51,9 @@ protected function mergeProperties(OA\Schema $schema, array $from, array &$exist
 
     protected function mergeMethods(OA\Schema $schema, array $from, array &$existing): void
     {
-        foreach ($from['methods'] as $method) {
-            if (is_iterable($method->annotations)) {
-                foreach ($method->annotations as $annotation) {
+        foreach ($from['methods'] as $context) {
+            if (is_iterable($context->annotations)) {
+                foreach ($context->annotations as $annotation) {
                     if ($annotation instanceof OA\Property && !in_array($annotation->_context->property, $existing, true)) {
                         $existing[] = $annotation->_context->property;
                         $schema->merge([$annotation], true);
diff --git a/src/Processors/ExpandClasses.php b/src/Processors/ExpandClasses.php
index a462241f1..b7bea864c 100644
--- a/src/Processors/ExpandClasses.php
+++ b/src/Processors/ExpandClasses.php
@@ -9,7 +9,6 @@
 use OpenApi\Analysis;
 use OpenApi\Annotations as OA;
 use OpenApi\Attributes as OAT;
-use OpenApi\Context;
 use OpenApi\Generator;
 
 /**
@@ -17,8 +16,7 @@
  * - if the ancestor has a schema
  *   => inherit from the ancestor if it has a schema (allOf) and stop.
  * - else
- *   => merge ancestor properties into the schema
- *   => merge ancestor trait properties into the schema (recursively).
+ *   => merge ancestor properties into the schema.
  */
 class ExpandClasses
 {
@@ -44,14 +42,6 @@ public function __invoke(Analysis $analysis)
                     } else {
                         $this->mergeMethods($schema, $ancestor, $existing);
                         $this->mergeProperties($schema, $ancestor, $existing);
-
-                        $traits = $analysis->getTraitsOfClass($schema->_context->fullyQualifiedName($ancestor['class']), true);
-                        foreach ($traits as $definition) {
-                            /** @var Context $context */
-                            foreach ($definition['properties'] as $context) {
-                                $this->mergeAnnotations($schema, $context->annotations, $existing);
-                            }
-                        }
                     }
                 }
             }
diff --git a/src/Processors/ExpandTraits.php b/src/Processors/ExpandTraits.php
index 3a52d65f6..bdcdabcdf 100644
--- a/src/Processors/ExpandTraits.php
+++ b/src/Processors/ExpandTraits.php
@@ -25,10 +25,10 @@ public function __invoke(Analysis $analysis)
         /** @var OA\Schema[] $schemas */
         $schemas = $analysis->getAnnotationsOfType([OA\Schema::class, OAT\Schema::class], true);
 
+        // do regular trait inheritance / merge
         foreach ($schemas as $schema) {
-            if ($schema->_context->is('class') || $schema->_context->is('trait')) {
-                $source = $schema->_context->class ?: $schema->_context->trait;
-                $traits = $analysis->getTraitsOfClass($schema->_context->fullyQualifiedName($source), true);
+            if ($schema->_context->is('trait')) {
+                $traits = $analysis->getTraitsOfClass($schema->_context->fullyQualifiedName($schema->_context->trait), true);
                 $existing = [];
                 foreach ($traits as $trait) {
                     $traitSchema = $analysis->getSchemaForSource($trait['context']->fullyQualifiedName($trait['trait']));
@@ -36,7 +36,40 @@ public function __invoke(Analysis $analysis)
                         $refPath = !Generator::isDefault($traitSchema->schema) ? $traitSchema->schema : $trait['trait'];
                         $this->inheritFrom($analysis, $schema, $traitSchema, $refPath, $trait['context']);
                     } else {
-                        if ($schema->_context->is('class')) {
+                        $this->mergeMethods($schema, $trait, $existing);
+                        $this->mergeProperties($schema, $trait, $existing);
+                    }
+                }
+            }
+        }
+
+        foreach ($schemas as $schema) {
+            if ($schema->_context->is('class') && !$schema->_aux) {
+                // look at class traits
+                $traits = $analysis->getTraitsOfClass($schema->_context->fullyQualifiedName($schema->_context->class), true);
+                $existing = [];
+                foreach ($traits as $trait) {
+                    $traitSchema = $analysis->getSchemaForSource($trait['context']->fullyQualifiedName($trait['trait']));
+                    if ($traitSchema) {
+                        $refPath = !Generator::isDefault($traitSchema->schema) ? $traitSchema->schema : $trait['trait'];
+                        $this->inheritFrom($analysis, $schema, $traitSchema, $refPath, $trait['context']);
+                    } else {
+                        $this->mergeMethods($schema, $trait, $existing);
+                        $this->mergeProperties($schema, $trait, $existing);
+                    }
+                }
+
+                // also merge ancestor traits of non schema parents
+                $ancestors = $analysis->getSuperClasses($schema->_context->fullyQualifiedName($schema->_context->class));
+                $existing = [];
+                foreach ($ancestors as $ancestor) {
+                    $ancestorSchema = $analysis->getSchemaForSource($ancestor['context']->fullyQualifiedName($ancestor['class']));
+                    if ($ancestorSchema) {
+                        // stop here as we inherit everything above
+                        break;
+                    } else {
+                        $traits = $analysis->getTraitsOfClass($schema->_context->fullyQualifiedName($ancestor['class']), true);
+                        foreach ($traits as $trait) {
                             $this->mergeMethods($schema, $trait, $existing);
                             $this->mergeProperties($schema, $trait, $existing);
                         }
diff --git a/tests/Fixtures/Apis/basic.yaml b/tests/Fixtures/Apis/basic.yaml
index 190c71110..8aec68530 100644
--- a/tests/Fixtures/Apis/basic.yaml
+++ b/tests/Fixtures/Apis/basic.yaml
@@ -129,6 +129,7 @@ components:
     Product:
       title: Product
       description: 'A Product.'
+      type: object
       allOf:
         -
           $ref: '#/components/schemas/NameTrait'
@@ -144,12 +145,12 @@ components:
               example: null
             colour:
               $ref: '#/components/schemas/Colour'
+            releasedAt:
+              type: string
             id:
               description: 'The id.'
               format: int64
               example: 1
-            releasedAt:
-              type: string
             kind:
               description: 'The kind.'
               type: string
diff --git a/tests/Fixtures/Scratch/MergeTraits.php b/tests/Fixtures/Scratch/MergeTraits.php
index be5dfc9aa..57a8b704c 100644
--- a/tests/Fixtures/Scratch/MergeTraits.php
+++ b/tests/Fixtures/Scratch/MergeTraits.php
@@ -1,25 +1,13 @@
-<?php
+<?php declare(strict_types=1);
+
+/**
+ * @license Apache 2.0
+ */
 
 namespace OpenApi\Tests\Fixtures\Scratch;
 
 use OpenApi\Annotations as OA;
 
-/**
- * @OA\Info(title="API", version="1.0")
- *
- * @OA\Get(
- *     path="/api/endpoint",
- *     @OA\Response(
- *         response=200,
- *         description="successful operation",
- *         @OA\JsonContent(ref="#/components/schemas/Address")
- *     )
- * )
- */
-class Endpoint
-{
-}
-
 trait HasId
 {
     /**
@@ -74,3 +62,18 @@ class Address extends Model
     /** @OA\Property */
     public string $street;
 }
+
+/**
+ * @OA\Info(title="API", version="1.0")
+ * @OA\Get(
+ *     path="/api/endpoint",
+ *     @OA\Response(
+ *         response=200,
+ *         description="successful operation",
+ *         @OA\JsonContent(ref="#/components/schemas/Address")
+ *     )
+ * )
+ */
+class Endpoint
+{
+}
diff --git a/tests/Fixtures/Scratch/MergeTraits.yaml b/tests/Fixtures/Scratch/MergeTraits.yaml
new file mode 100644
index 000000000..acc1767b9
--- /dev/null
+++ b/tests/Fixtures/Scratch/MergeTraits.yaml
@@ -0,0 +1,37 @@
+openapi: 3.0.0
+info:
+  title: API
+  version: '1.0'
+paths:
+  /api/endpoint:
+    get:
+      responses:
+        '200':
+          description: 'successful operation'
+          content:
+            application/json:
+              schema:
+                $ref: '#/components/schemas/Address'
+components:
+  schemas:
+    Address:
+      required:
+        - street
+      properties:
+        id:
+          type: integer
+          format: int64
+          readOnly: true
+        created_at:
+          type: string
+          format: date-time
+          readOnly: true
+        updated_at:
+          type: string
+          format: date-time
+          readOnly: true
+        street:
+          type: string
+      type: object
+      xml:
+        name: Address
diff --git a/tests/Fixtures/Scratch/MergeTraitsExtended.php b/tests/Fixtures/Scratch/MergeTraitsExtended.php
new file mode 100644
index 000000000..2dffb08fa
--- /dev/null
+++ b/tests/Fixtures/Scratch/MergeTraitsExtended.php
@@ -0,0 +1,107 @@
+<?php declare(strict_types=1);
+
+/**
+ * @license Apache 2.0
+ */
+
+namespace App\Models;
+
+use App\Models\Product as ProductModel;
+use OpenApi\Annotations as OA;
+
+trait HasId
+{
+    /**
+     * @OA\Property(
+     *     format="int64",
+     *     readOnly=true
+     * )
+     */
+    public int $id;
+}
+
+trait HasTimestamps
+{
+    /**
+     * @OA\Property(
+     *     format="date-time",
+     *     type="string",
+     *     readOnly=true
+     * )
+     */
+    public \DateTime $created_at;
+
+    /**
+     * @OA\Property(
+     *     format="date-time",
+     *     type="string",
+     *     readOnly=true
+     * )
+     */
+    public \DateTime $updated_at;
+}
+
+trait HasSoftDelete
+{
+    /**
+     * @OA\Property(
+     *     format="date-time",
+     *     type="string",
+     *     readOnly=true
+     * )
+     */
+    public ?\DateTime $deleted_at;
+}
+
+/**
+ * @OA\Schema(
+ *     description="This model can be ignored, it is just used for inheritance."
+ * )
+ *
+ * @see BaseModel
+ */
+abstract class Model
+{
+    use HasId;
+    use HasTimestamps;
+}
+
+/**
+ * @OA\Schema(
+ *     description="Product",
+ *     required={
+ *         "number",
+ *         "name"
+ *     },
+ *     @OA\Xml(
+ *         name="Product"
+ *     )
+ * )
+ *
+ * @see ProductModel
+ */
+class Product extends Model
+{
+    use HasSoftDelete;
+
+    /** @OA\Property */
+    public string $number;
+
+    /** @OA\Property */
+    public string $name;
+}
+
+/**
+ * @OA\Info(title="API", version="1.0")
+ * @OA\Get(
+ *     path="/api/endpoint",
+ *     @OA\Response(
+ *         response=200,
+ *         description="successful operation",
+ *         @OA\JsonContent(ref="#/components/schemas/Product")
+ *     )
+ * )
+ */
+class Endpoint
+{
+}
diff --git a/tests/Fixtures/Scratch/MergeTraitsExtended.yaml b/tests/Fixtures/Scratch/MergeTraitsExtended.yaml
new file mode 100644
index 000000000..6e18f41a8
--- /dev/null
+++ b/tests/Fixtures/Scratch/MergeTraitsExtended.yaml
@@ -0,0 +1,53 @@
+openapi: 3.0.0
+info:
+  title: API
+  version: '1.0'
+paths:
+  /api/endpoint:
+    get:
+      responses:
+        '200':
+          description: 'successful operation'
+          content:
+            application/json:
+              schema:
+                $ref: '#/components/schemas/Product'
+components:
+  schemas:
+    Model:
+      description: 'This model can be ignored, it is just used for inheritance.'
+      properties:
+        id:
+          type: integer
+          format: int64
+          readOnly: true
+        created_at:
+          type: string
+          format: date-time
+          readOnly: true
+        updated_at:
+          type: string
+          format: date-time
+          readOnly: true
+      type: object
+    Product:
+      description: Product
+      required:
+        - number
+        - name
+      type: object
+      xml:
+        name: Product
+      allOf:
+        -
+          $ref: '#/components/schemas/Model'
+        -
+          properties:
+            deleted_at:
+              type: string
+              format: date-time
+              readOnly: true
+            number:
+              type: string
+            name:
+              type: string
diff --git a/tests/Processors/ExpandClassesTest.php b/tests/Processors/ExpandClassesTest.php
index ca458801e..028999c00 100644
--- a/tests/Processors/ExpandClassesTest.php
+++ b/tests/Processors/ExpandClassesTest.php
@@ -174,8 +174,8 @@ public function testExpandClassesWithTwoChildSchemas(): void
 
         $this->assertCount(2, $extendedSchema->allOf);
         $this->assertEquals(Components::ref('Base'), $extendedSchema->allOf[0]->ref);
-        $this->assertEquals('nested', $extendedSchema->allOf[1]->properties[1]->property);
-        $this->assertEquals('extendedProperty', $extendedSchema->allOf[1]->properties[0]->property);
+        $this->assertEquals('nested', $extendedSchema->allOf[1]->properties[0]->property);
+        $this->assertEquals('extendedProperty', $extendedSchema->allOf[1]->properties[1]->property);
 
         $nestedSchema = $schemas[1];
         $this->assertCount(2, $nestedSchema->allOf);
diff --git a/tests/ScratchTest.php b/tests/ScratchTest.php
index 47c7e828d..26b6fda71 100644
--- a/tests/ScratchTest.php
+++ b/tests/ScratchTest.php
@@ -40,7 +40,7 @@ public function testScratch(string $version, string $scratch, string $spec, arra
         $openapi = (new Generator($this->getTrackingLogger()))
             ->setVersion($version)
             ->generate([$scratch]);
-        //file_put_contents($spec, $openapi->toYaml());
+        // file_put_contents($spec, $openapi->toYaml());
         $this->assertSpecEquals($openapi, file_get_contents($spec));
     }
 }
diff --git a/tests/UtilTest.php b/tests/UtilTest.php
index b11f725c1..152ab35de 100644
--- a/tests/UtilTest.php
+++ b/tests/UtilTest.php
@@ -27,6 +27,7 @@ public function testExclude(): void
             'Parser',
             'Analysers',
             'Processors',
+            'Scratch',
             'TypedProperties.php',
             'Unreferenced.php',
             'UsingRefs.php',