diff --git a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/UnifiedClaimMetadataManager.java b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/UnifiedClaimMetadataManager.java
index c866c4e1a9a6..c8b06ad91a37 100644
--- a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/UnifiedClaimMetadataManager.java
+++ b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/UnifiedClaimMetadataManager.java
@@ -134,14 +134,19 @@ public List<LocalClaim> getLocalClaims(int tenantId) throws ClaimMetadataExcepti
         List<LocalClaim> localClaimsInSystem = this.systemDefaultClaimMetadataManager.getLocalClaims(tenantId);
         List<LocalClaim> localClaimsInDB = this.dbBasedClaimMetadataManager.getLocalClaims(tenantId);
 
-        Set<String> claimURIsInDB = localClaimsInDB.stream()
-                .map(LocalClaim::getClaimURI)
-                .collect(Collectors.toSet());
-
         List<LocalClaim> allLocalClaims = new ArrayList<>(localClaimsInDB);
-        localClaimsInSystem.stream()
-                .filter(localClaim -> !claimURIsInDB.contains(localClaim.getClaimURI()))
-                .forEach(allLocalClaims::add);
+        localClaimsInSystem.forEach(systemClaim -> {
+            Optional<LocalClaim> matchingClaimInDB = allLocalClaims.stream()
+                    .filter(dbClaim -> dbClaim.getClaimURI().equals(systemClaim.getClaimURI()))
+                    .findFirst();
+
+            if (matchingClaimInDB.isPresent()) {
+                matchingClaimInDB.get().setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+            } else {
+                systemClaim.setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+                allLocalClaims.add(systemClaim);
+            }
+        });
 
         return allLocalClaims;
     }
@@ -158,9 +163,17 @@ public Optional<LocalClaim> getLocalClaim(String localClaimURI, int tenantId) th
 
         Optional<LocalClaim> localClaimInDB = this.dbBasedClaimMetadataManager.getLocalClaim(localClaimURI, tenantId);
         if (localClaimInDB.isPresent()) {
+            if (isSystemDefaultLocalClaim(localClaimURI, tenantId)) {
+                localClaimInDB.get().setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+            }
             return localClaimInDB;
         }
-        return this.systemDefaultClaimMetadataManager.getLocalClaim(localClaimURI, tenantId);
+        Optional<LocalClaim> localClaimInSystem = this.systemDefaultClaimMetadataManager.getLocalClaim(localClaimURI, tenantId);
+        if (localClaimInSystem.isPresent()) {
+            localClaimInSystem.get().setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+            return localClaimInSystem;
+        }
+        return Optional.empty();
     }
 
     /**
@@ -172,6 +185,7 @@ public Optional<LocalClaim> getLocalClaim(String localClaimURI, int tenantId) th
      */
     public void addLocalClaim(LocalClaim localClaim, int tenantId) throws ClaimMetadataException {
 
+        localClaim.getClaimProperties().remove(ClaimConstants.IS_SYSTEM_CLAIM);
         if (!isClaimDialectInDB(ClaimConstants.LOCAL_CLAIM_DIALECT_URI, tenantId)) {
             addSystemDefaultDialectToDB(ClaimConstants.LOCAL_CLAIM_DIALECT_URI, tenantId);
         }
@@ -187,6 +201,7 @@ public void addLocalClaim(LocalClaim localClaim, int tenantId) throws ClaimMetad
      */
     public void updateLocalClaim(LocalClaim localClaim, int tenantId) throws ClaimMetadataException {
 
+        localClaim.getClaimProperties().remove(ClaimConstants.IS_SYSTEM_CLAIM);
         if (isLocalClaimInDB(localClaim.getClaimURI(), tenantId)) {
             this.dbBasedClaimMetadataManager.updateLocalClaim(localClaim, tenantId);
         } else {
@@ -264,9 +279,11 @@ public List<ExternalClaim> getExternalClaims(String externalClaimDialectURI, int
         for (ExternalClaim externalClaimInSystem : externalClaimsInSystem) {
             ExternalClaim matchingClaimInDB = externalClaimsInDBMap.get(externalClaimInSystem.getClaimURI());
             if (matchingClaimInDB != null) {
+                matchingClaimInDB.setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
                 allExternalClaims.add(matchingClaimInDB);
                 externalClaimsInDBMap.remove(externalClaimInSystem.getClaimURI());
             } else {
+                externalClaimInSystem.setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
                 allExternalClaims.add(externalClaimInSystem);
             }
         }
@@ -289,9 +306,18 @@ public Optional<ExternalClaim> getExternalClaim(String externalClaimDialectURI,
         Optional<ExternalClaim> externalClaim = this.dbBasedClaimMetadataManager.getExternalClaim(
                 externalClaimDialectURI, claimURI, tenantId);
         if (externalClaim.isPresent()) {
+            if (isSystemDefaultExternalClaim(externalClaimDialectURI, claimURI, tenantId)) {
+                externalClaim.get().setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+            }
             return externalClaim;
         }
-        return this.systemDefaultClaimMetadataManager.getExternalClaim(externalClaimDialectURI, claimURI, tenantId);
+        Optional<ExternalClaim> externalClaimInSystem = this.systemDefaultClaimMetadataManager.getExternalClaim(
+                externalClaimDialectURI, claimURI, tenantId);
+        if (externalClaimInSystem.isPresent()) {
+            externalClaimInSystem.get().setClaimProperty(ClaimConstants.IS_SYSTEM_CLAIM, Boolean.TRUE.toString());
+            return externalClaimInSystem;
+        }
+        return Optional.empty();
     }
 
     /**
@@ -304,6 +330,7 @@ public Optional<ExternalClaim> getExternalClaim(String externalClaimDialectURI,
     public void addExternalClaim(ExternalClaim externalClaim, int tenantId)
             throws ClaimMetadataException {
 
+        externalClaim.getClaimProperties().remove(ClaimConstants.IS_SYSTEM_CLAIM);
         if (!isClaimDialectInDB(externalClaim.getClaimDialectURI(), tenantId)) {
             addSystemDefaultDialectToDB(externalClaim.getClaimDialectURI(), tenantId);
         }
@@ -323,6 +350,7 @@ public void addExternalClaim(ExternalClaim externalClaim, int tenantId)
     public void updateExternalClaim(ExternalClaim externalClaim, int tenantId)
             throws ClaimMetadataException {
 
+        externalClaim.getClaimProperties().remove(ClaimConstants.IS_SYSTEM_CLAIM);
         if (isExternalClaimInDB(externalClaim.getClaimURI(), externalClaim.getClaimDialectURI(), tenantId)) {
             this.dbBasedClaimMetadataManager.updateExternalClaim(externalClaim, tenantId);
         } else {
diff --git a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimConstants.java b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimConstants.java
index 0abdf874423d..d2ac03010392 100644
--- a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimConstants.java
+++ b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimConstants.java
@@ -41,6 +41,7 @@ public class ClaimConstants {
     public static final String MAPPED_LOCAL_CLAIM_PROPERTY = "MappedLocalClaim";
     public static final String MIN_LENGTH = "minLength";
     public static final String MAX_LENGTH = "maxLength";
+    public static final String IS_SYSTEM_CLAIM = "isSystemClaim";
 
     /**
      * Enum for error messages.
diff --git a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimMetadataUtils.java b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimMetadataUtils.java
index 68cae4270081..f75ad03383d4 100644
--- a/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimMetadataUtils.java
+++ b/components/claim-mgt/org.wso2.carbon.identity.claim.metadata.mgt/src/main/java/org/wso2/carbon/identity/claim/metadata/mgt/util/ClaimMetadataUtils.java
@@ -347,8 +347,7 @@ public static ClaimMapping convertExternalClaimToClaimMapping(ExternalClaim exte
                     claim = createLocalClaim(claimKey, claimMapping,
                             filterClaimProperties(claimConfig.getPropertyHolderMap().get(claimKey)));
                 } else {
-                    claim = createExternalClaim(claimKey, filterClaimProperties(claimConfig.getPropertyHolderMap()
-                            .get(claimKey)));
+                    claim = createExternalClaim(claimKey, claimConfig.getPropertyHolderMap().get(claimKey));
                 }
                 claims.computeIfAbsent(claimDialectURI, k -> new ArrayList<>()).add(claim);
             }
@@ -361,6 +360,7 @@ public static Map<String, String> filterClaimProperties(Map<String, String> clai
         claimProperties.remove(ClaimConstants.DIALECT_PROPERTY);
         claimProperties.remove(ClaimConstants.CLAIM_URI_PROPERTY);
         claimProperties.remove(ClaimConstants.ATTRIBUTE_ID_PROPERTY);
+        claimProperties.remove(ClaimConstants.IS_SYSTEM_CLAIM);
 
         claimProperties.putIfAbsent(ClaimConstants.DISPLAY_NAME_PROPERTY, "0");
         claimProperties.computeIfPresent(ClaimConstants.SUPPORTED_BY_DEFAULT_PROPERTY,