@@ -23,6 +23,10 @@ to docs, or any other relevant information.
 - Release notes for all future releases are now in a single CHANGELOG.md file. `releases` directory with old release
   notes is kept for historical reference.
 
+### Fixed
+- Test server now honors retry expiration deadlines that fall exactly on a whole second. Previously such deadlines were
+  ignored and retries were scheduled past them instead of failing with `RETRY_STATE_TIMEOUT`.
+
 ## Previous releases
 
 Changelogs for releases 1.40 and older are available in [releases](/releases) directory.
@@ -129,8 +129,7 @@ BackoffInterval getBackoffIntervalInSeconds(
 
     Timestamp nextScheduleTime =
         Timestamps.add(currentTime, ProtobufTimeUtils.toProtoDuration(backoffDuration));
-    if (expirationTime.getNanos() != 0
-        && Timestamps.compare(nextScheduleTime, expirationTime) > 0) {
+    if (Timestamps.compare(nextScheduleTime, expirationTime) > 0) {
       return new BackoffInterval(RetryState.RETRY_STATE_TIMEOUT);
     }
     return new BackoffInterval(backoffDuration);
 
@@ -0,0 +1,72 @@
+package io.temporal.internal.testservice;
+
+import static org.junit.Assert.assertEquals;
+
+import com.google.protobuf.Timestamp;
+import com.google.protobuf.util.Durations;
+import com.google.protobuf.util.Timestamps;
+import io.temporal.api.common.v1.RetryPolicy;
+import io.temporal.api.enums.v1.RetryState;
+import java.time.Duration;
+import java.util.Optional;
+import org.junit.Test;
+
+public class TestServiceRetryStateTest {
+
+  private static final RetryPolicy RETRY_POLICY =
+      RetryPolicy.newBuilder()
+          .setInitialInterval(Durations.fromSeconds(10))
+          .setBackoffCoefficient(1.0)
+          .build();
+
+  @Test
+  public void expirationOnWholeSecondTimesOut() {
+    // A deadline with a zero nanos field must still be honored.
+    Timestamp now = Timestamps.fromSeconds(1_000);
+    Timestamp expiration = Timestamps.fromSeconds(1_005);
+    TestServiceRetryState state = new TestServiceRetryState(RETRY_POLICY, expiration);
+
+    TestServiceRetryState.BackoffInterval backoff =
+        state.getBackoffIntervalInSeconds(Optional.empty(), now, Optional.empty());
+
+    assertEquals(RetryState.RETRY_STATE_TIMEOUT, backoff.getRetryState());
+  }
+
+  @Test
+  public void expirationWithSubsecondTimesOut() {
+    Timestamp now = Timestamps.fromMillis(1_000_500);
+    Timestamp expiration = Timestamps.fromMillis(1_005_500);
+    TestServiceRetryState state = new TestServiceRetryState(RETRY_POLICY, expiration);
+
+    TestServiceRetryState.BackoffInterval backoff =
+        state.getBackoffIntervalInSeconds(Optional.empty(), now, Optional.empty());
+
+    assertEquals(RetryState.RETRY_STATE_TIMEOUT, backoff.getRetryState());
+  }
+
+  @Test
+  public void unsetExpirationNeverTimesOut() {
+    Timestamp now = Timestamps.fromSeconds(1_000);
+    TestServiceRetryState state =
+        new TestServiceRetryState(RETRY_POLICY, Timestamp.getDefaultInstance());
+
+    TestServiceRetryState.BackoffInterval backoff =
+        state.getBackoffIntervalInSeconds(Optional.empty(), now, Optional.empty());
+
+    assertEquals(RetryState.RETRY_STATE_IN_PROGRESS, backoff.getRetryState());
+    assertEquals(Duration.ofSeconds(10), backoff.getInterval());
+  }
+
+  @Test
+  public void retryWithinExpirationProceeds() {
+    Timestamp now = Timestamps.fromSeconds(1_000);
+    Timestamp expiration = Timestamps.fromSeconds(1_060);
+    TestServiceRetryState state = new TestServiceRetryState(RETRY_POLICY, expiration);
+
+    TestServiceRetryState.BackoffInterval backoff =
+        state.getBackoffIntervalInSeconds(Optional.empty(), now, Optional.empty());
+
+    assertEquals(RetryState.RETRY_STATE_IN_PROGRESS, backoff.getRetryState());
+    assertEquals(Duration.ofSeconds(10), backoff.getInterval());
+  }
+}
Original file line number	Diff line number	Diff line change
`@@ -129,8 +129,7 @@ BackoffInterval getBackoffIntervalInSeconds(`
`129`	`129`
`130`	`130`	`Timestamp nextScheduleTime =`
`131`	`131`	`Timestamps.add(currentTime, ProtobufTimeUtils.toProtoDuration(backoffDuration));`
`132`		`- if (expirationTime.getNanos() != 0`
`133`		`- && Timestamps.compare(nextScheduleTime, expirationTime) > 0) {`
	`132`	`+ if (Timestamps.compare(nextScheduleTime, expirationTime) > 0) {`
`134`	`133`	`return new BackoffInterval(RetryState.RETRY_STATE_TIMEOUT);`
`135`	`134`	`}`
`136`	`135`	`return new BackoffInterval(backoffDuration);`