diff --git a/compiler/src/dotty/tools/dotc/core/Annotations.scala b/compiler/src/dotty/tools/dotc/core/Annotations.scala
index 45dba97a79f7..558463618d81 100644
--- a/compiler/src/dotty/tools/dotc/core/Annotations.scala
+++ b/compiler/src/dotty/tools/dotc/core/Annotations.scala
@@ -7,6 +7,7 @@ import ast.tpd, tpd.*
 import util.Spans.Span
 import printing.{Showable, Printer}
 import printing.Texts.Text
+import cc.isRetainsLike
 
 import scala.annotation.internal.sharable
 
@@ -63,7 +64,11 @@ object Annotations {
             else
               val tp1 = tm(tree.tpe)
               foldOver(if tp1 frozen_=:= tree.tpe then x else tp1, tree)
-        val diff = findDiff(NoType, args)
+        val diff = if symbol.isRetainsLike then defn.AnyType else findDiff(NoType, args)
+          // If this is a @retains annotation, the diff check seems to be unreliable.
+          // We work around this issue by always mapping @retains annotations. See #20035.
+          //
+          // FIXME: investigate why the diff check is incorrect for @retains
         if tm.isRange(diff) then EmptyAnnotation
         else if diff.exists then derivedAnnotation(tm.mapOver(tree))
         else this
@@ -73,9 +78,16 @@ object Annotations {
       val args = arguments
       if args.isEmpty then false
       else tree.existsSubTree:
-        case id: (Ident | This) => id.tpe.stripped match
+        case id: Ident => id.tpe.stripped match
           case TermParamRef(tl1, _) => tl eq tl1
           case _ => false
+        case ref: This => ref.tpe match
+          case TermParamRef(tl1, _) => tl eq tl1
+          case AnnotatedType(tp1, annot1) =>
+            // The type of captured elements in @retains annotation could themself
+            // refer to term parameters.  See #20035.
+            annot1.refersToParamOf(tl)
+          case _ => false
         case _ => false
 
     /** A string representation of the annotation. Overridden in BodyAnnotation.
diff --git a/tests/pos-custom-args/captures/tablediff.scala b/tests/pos-custom-args/captures/tablediff.scala
new file mode 100644
index 000000000000..244ee1a46a23
--- /dev/null
+++ b/tests/pos-custom-args/captures/tablediff.scala
@@ -0,0 +1,11 @@
+import language.experimental.captureChecking
+
+trait Seq[+A]:
+  def zipAll[A1 >: A, B](that: Seq[B]^, thisElem: A1, thatElem: B): Seq[(A1, B)]^{this, that}
+  def map[B](f: A => B): Seq[B]^{this, f}
+
+def zipAllOption[X](left: Seq[X], right: Seq[X]) =
+  left.map(Option(_)).zipAll(right.map(Option(_)), None, None)
+
+def fillRow[T](headRow: Seq[T], tailRow: Seq[T]) =
+  val paddedZip = zipAllOption(headRow, tailRow)