diff --git a/qubes/api/misc.py b/qubes/api/misc.py
index 8de735fb..232d6ae0 100644
--- a/qubes/api/misc.py
+++ b/qubes/api/misc.py
@@ -71,64 +71,22 @@ class QubesMiscAPI(qubes.api.AbstractQubesAPI):
         assert self.dest.name == 'dom0'
         assert not self.arg
 
-        if getattr(self.src, 'template', None):
-            self.src.log.warning(
-                'Ignoring qubes.NotifyTools for template-based VM')
-            return
+        untrusted_features = {}
+        safe_set = string.ascii_letters + string.digits
+        expected_features = ('version', 'qrexec', 'gui', 'default-user')
+        for feature in expected_features:
+            untrusted_value = self.src.qdb.read('/qubes-tools/' + feature)
+            if untrusted_value:
+                untrusted_value = untrusted_value.decode('ascii',
+                    errors='strict')
+                assert all((c in safe_set) for c in untrusted_value)
+                untrusted_features[feature] = untrusted_value
+            del untrusted_value
 
-        # for now used only to check for the tools presence
-        untrusted_version = self.src.qdb.read('/qubes-tools/version')
-
-        # reserved for future use
-        #untrusted_os = self.src.qdb.read('/qubes-tools/os')
-
-        # qrexec agent presence (0 or 1)
-        untrusted_qrexec = self.src.qdb.read('/qubes-tools/qrexec')
-
-        # gui agent presence (0 or 1)
-        untrusted_gui = self.src.qdb.read('/qubes-tools/gui')
-
-        # default user for qvm-run etc
-        # starting with Qubes 4.x ignored
-        #untrusted_user = self.src.qdb.read('/qubes-tools/default-user')
-
-        if untrusted_version is None:
-            # tools didn't advertised its features; it's strange that this
-            # service is called, but ignore it
-            return
-
-        # any suspicious string will raise exception here
-        int(untrusted_version)
-        del untrusted_version
-
-        # untrusted_os - ignore for now
-
-        if untrusted_qrexec is None:
-            qrexec = False
-        else:
-            qrexec = bool(int(untrusted_qrexec))
-        del untrusted_qrexec
-
-        if untrusted_gui is None:
-            gui = False
-        else:
-            gui = bool(int(untrusted_gui))
-        del untrusted_gui
-
-        # ignore default_user
-
-        prev_qrexec = self.src.features.get('qrexec', False)
-        # Let the tools to be able to enable *or disable*
-        # each particular component
-        self.src.features['qrexec'] = qrexec
-        self.src.features['gui'] = gui
+        self.src.fire_event('features-request',
+            untrusted_features=untrusted_features)
         self.app.save()
 
-        if not prev_qrexec and qrexec:
-            # if this is the first time qrexec was advertised, now can finish
-            #  template setup
-            self.src.fire_event('template-postinstall')
-
     @qubes.api.method('qubes.NotifyUpdates')
     @asyncio.coroutine
     def qubes_notify_updates(self, untrusted_payload):
diff --git a/qubes/ext/core_features.py b/qubes/ext/core_features.py
new file mode 100644
index 00000000..87d096ad
--- /dev/null
+++ b/qubes/ext/core_features.py
@@ -0,0 +1,62 @@
+# -*- encoding: utf8 -*-
+#
+# The Qubes OS Project, http://www.qubes-os.org
+#
+# Copyright (C) 2017 Marek Marczykowski-Górecki
+#                               <marmarek@invisiblethingslab.com>
+#
+# This program is free software; you can redistribute it and/or modify
+# it under the terms of the GNU General Public License as published by
+# the Free Software Foundation; either version 2 of the License, or
+# (at your option) any later version.
+#
+# This program is distributed in the hope that it will be useful,
+# but WITHOUT ANY WARRANTY; without even the implied warranty of
+# MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+# GNU General Public License for more details.
+#
+# You should have received a copy of the GNU General Public License along
+# with this program; if not, see <http://www.gnu.org/licenses/>.
+
+import qubes.ext
+
+class CoreFeatures(qubes.ext.Extension):
+    # pylint: disable=too-few-public-methods
+    @qubes.ext.handler('features-request')
+    def qubes_features_request(self, vm, event, untrusted_features):
+        '''Handle features provided by qubes-core-agent and qubes-gui-agent'''
+        # pylint: disable=no-self-use,unused-argument
+        if getattr(vm, 'template', None):
+            vm.log.warning(
+                'Ignoring qubes.NotifyTools for template-based VM')
+            return
+
+        # for now used only to check for the tools presence
+        if 'version' in untrusted_features:
+            # any suspicious string will raise exception here,
+            # but otherwise ignored
+            int(untrusted_features['version'])
+
+        requested_features = {}
+        for feature in ('qrexec', 'gui'):
+            untrusted_value = untrusted_features.get(feature, None)
+            if untrusted_value in ('1', '0'):
+                requested_features[feature] = bool(int(untrusted_value))
+        del untrusted_features
+
+        # default user for qvm-run etc
+        # starting with Qubes 4.x ignored
+        # qrexec agent presence (0 or 1)
+        # gui agent presence (0 or 1)
+
+        qrexec_before = vm.features.get('qrexec', False)
+        for feature in ('qrexec', 'gui'):
+            # do not allow (Template)VM to override setting if already set
+            # some other way
+            if feature in requested_features and feature not in vm.features:
+                vm.features[feature] = requested_features[feature]
+
+        if not qrexec_before and vm.features.get('qrexec', False):
+            # if this is the first time qrexec was advertised, now can finish
+            #  template setup
+            vm.fire_event('template-postinstall')
diff --git a/qubes/tests/__init__.py b/qubes/tests/__init__.py
index a53ca25b..09c9d980 100644
--- a/qubes/tests/__init__.py
+++ b/qubes/tests/__init__.py
@@ -963,6 +963,7 @@ def load_tests(loader, tests, pattern): # pylint: disable=unused-argument
             'qubes.tests.storage_file',
             'qubes.tests.storage_lvm',
             'qubes.tests.storage_kernels',
+            'qubes.tests.ext',
             'qubes.tests.vm.qubesvm',
             'qubes.tests.vm.mix.net',
             'qubes.tests.vm.adminvm',
diff --git a/qubes/tests/api_misc.py b/qubes/tests/api_misc.py
index 46c71f03..59c735bf 100644
--- a/qubes/tests/api_misc.py
+++ b/qubes/tests/api_misc.py
@@ -118,8 +118,6 @@ class TC_00_API_Misc(qubes.tests.QubesTestCase):
             '/qubes-tools/default-user': b'user',
         }
         self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': False})
         response = self.call_mgmt_func(b'qubes.NotifyTools')
         self.assertIsNone(response)
         self.assertEqual(self.app.mock_calls, [
@@ -129,78 +127,36 @@ class TC_00_API_Misc(qubes.tests.QubesTestCase):
             mock.call.qdb.read('/qubes-tools/version'),
             mock.call.qdb.read('/qubes-tools/qrexec'),
             mock.call.qdb.read('/qubes-tools/gui'),
-            mock.call.features.get('qrexec', False),
-            mock.call.features.__setitem__('qrexec', True),
-            mock.call.features.__setitem__('gui', True),
-            mock.call.fire_event('template-postinstall')
-        ])
-
-    def test_011_notify_tools_uninstall(self):
-        qdb_entries = {
-            '/qubes-tools/version': b'1',
-            '/qubes-tools/qrexec': b'0',
-            '/qubes-tools/gui': b'0',
-            '/qubes-tools/os': b'Linux',
-            '/qubes-tools/default-user': b'user',
-        }
-        self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        response = self.call_mgmt_func(b'qubes.NotifyTools')
-        self.assertIsNone(response)
-        self.assertEqual(self.app.mock_calls, [
-            mock.call.save()
-        ])
-        self.assertEqual(self.src.mock_calls, [
-            mock.call.qdb.read('/qubes-tools/version'),
-            mock.call.qdb.read('/qubes-tools/qrexec'),
-            mock.call.qdb.read('/qubes-tools/gui'),
-            mock.call.features.get('qrexec', False),
-            mock.call.features.__setitem__('qrexec', False),
-            mock.call.features.__setitem__('gui', False),
-        ])
-
-    def test_012_notify_tools_uninstall2(self):
-        qdb_entries = {
-            '/qubes-tools/version': b'1',
-            '/qubes-tools/os': b'Linux',
-            '/qubes-tools/default-user': b'user',
-        }
-        self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        response = self.call_mgmt_func(b'qubes.NotifyTools')
-        self.assertIsNone(response)
-        self.assertEqual(self.app.mock_calls, [
-            mock.call.save()
-        ])
-        self.assertEqual(self.src.mock_calls, [
-            mock.call.qdb.read('/qubes-tools/version'),
-            mock.call.qdb.read('/qubes-tools/qrexec'),
-            mock.call.qdb.read('/qubes-tools/gui'),
-            mock.call.features.get('qrexec', False),
-            mock.call.features.__setitem__('qrexec', False),
-            mock.call.features.__setitem__('gui', False),
+            mock.call.qdb.read('/qubes-tools/default-user'),
+            mock.call.fire_event('features-request', untrusted_features={
+                'gui': '1',
+                'version': '1',
+                'default-user': 'user',
+                'qrexec': '1'}),
         ])
+        self.assertEqual(self.app.mock_calls, [mock.call.save()])
 
     def test_013_notify_tools_no_version(self):
         qdb_entries = {
-            '/qubes-tools/qrexec': b'0',
-            '/qubes-tools/gui': b'0',
+            '/qubes-tools/qrexec': b'1',
+            '/qubes-tools/gui': b'1',
             '/qubes-tools/os': b'Linux',
             '/qubes-tools/default-user': b'user',
         }
         self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
         response = self.call_mgmt_func(b'qubes.NotifyTools')
         self.assertIsNone(response)
-        self.assertEqual(self.app.mock_calls, [])
         self.assertEqual(self.src.mock_calls, [
             mock.call.qdb.read('/qubes-tools/version'),
             mock.call.qdb.read('/qubes-tools/qrexec'),
             mock.call.qdb.read('/qubes-tools/gui'),
+            mock.call.qdb.read('/qubes-tools/default-user'),
+            mock.call.fire_event('features-request', untrusted_features={
+                'gui': '1',
+                'default-user': 'user',
+                'qrexec': '1'}),
         ])
+        self.assertEqual(self.app.mock_calls, [mock.call.save()])
 
     def test_014_notify_tools_invalid_version(self):
         qdb_entries = {
@@ -211,50 +167,41 @@ class TC_00_API_Misc(qubes.tests.QubesTestCase):
             '/qubes-tools/default-user': b'user',
         }
         self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        with self.assertRaises(ValueError):
+        with self.assertRaises(AssertionError):
             self.call_mgmt_func(b'qubes.NotifyTools')
-        self.assertEqual(self.app.mock_calls, [])
+        # should be rejected later
         self.assertEqual(self.src.mock_calls, [
             mock.call.qdb.read('/qubes-tools/version'),
-            mock.call.qdb.read('/qubes-tools/qrexec'),
-            mock.call.qdb.read('/qubes-tools/gui'),
         ])
-
+        self.assertEqual(self.app.mock_calls, [])
 
     def test_015_notify_tools_invalid_value_qrexec(self):
         qdb_entries = {
             '/qubes-tools/version': b'1',
-            '/qubes-tools/qrexec': b'invalid',
+            '/qubes-tools/qrexec': b'invalid value',
             '/qubes-tools/gui': b'0',
             '/qubes-tools/os': b'Linux',
             '/qubes-tools/default-user': b'user',
         }
         self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        with self.assertRaises(ValueError):
+        with self.assertRaises(AssertionError):
             self.call_mgmt_func(b'qubes.NotifyTools')
         self.assertEqual(self.app.mock_calls, [])
         self.assertEqual(self.src.mock_calls, [
             mock.call.qdb.read('/qubes-tools/version'),
             mock.call.qdb.read('/qubes-tools/qrexec'),
-            mock.call.qdb.read('/qubes-tools/gui'),
         ])
 
     def test_016_notify_tools_invalid_value_gui(self):
         qdb_entries = {
             '/qubes-tools/version': b'1',
             '/qubes-tools/qrexec': b'1',
-            '/qubes-tools/gui': b'invalid',
+            '/qubes-tools/gui': b'invalid value',
             '/qubes-tools/os': b'Linux',
             '/qubes-tools/default-user': b'user',
         }
         self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        with self.assertRaises(ValueError):
+        with self.assertRaises(AssertionError):
             self.call_mgmt_func(b'qubes.NotifyTools')
         self.assertEqual(self.app.mock_calls, [])
         self.assertEqual(self.src.mock_calls, [
@@ -263,50 +210,6 @@ class TC_00_API_Misc(qubes.tests.QubesTestCase):
             mock.call.qdb.read('/qubes-tools/gui'),
         ])
 
-    def test_017_notify_tools_template_based(self):
-        qdb_entries = {
-            '/qubes-tools/version': b'1',
-            '/qubes-tools/qrexec': b'1',
-            '/qubes-tools/gui': b'invalid',
-            '/qubes-tools/os': b'Linux',
-            '/qubes-tools/default-user': b'user',
-        }
-        self.configure_qdb(qdb_entries)
-        self.src.configure_mock(**{'features.get.return_value': True})
-        response = self.call_mgmt_func(b'qubes.NotifyTools')
-        self.assertIsNone(response)
-        self.assertEqual(self.app.mock_calls, [])
-        self.assertEqual(self.src.mock_calls, [
-            mock.call.template.__bool__(),
-            mock.call.log.warning(
-                'Ignoring qubes.NotifyTools for template-based VM')
-        ])
-
-    def test_018_notify_tools_already_installed(self):
-        qdb_entries = {
-            '/qubes-tools/version': b'1',
-            '/qubes-tools/qrexec': b'1',
-            '/qubes-tools/gui': b'1',
-            '/qubes-tools/os': b'Linux',
-            '/qubes-tools/default-user': b'user',
-        }
-        self.configure_qdb(qdb_entries)
-        del self.src.template
-        self.src.configure_mock(**{'features.get.return_value': True})
-        response = self.call_mgmt_func(b'qubes.NotifyTools')
-        self.assertIsNone(response)
-        self.assertEqual(self.app.mock_calls, [
-            mock.call.save()
-        ])
-        self.assertEqual(self.src.mock_calls, [
-            mock.call.qdb.read('/qubes-tools/version'),
-            mock.call.qdb.read('/qubes-tools/qrexec'),
-            mock.call.qdb.read('/qubes-tools/gui'),
-            mock.call.features.get('qrexec', False),
-            mock.call.features.__setitem__('qrexec', True),
-            mock.call.features.__setitem__('gui', True),
-        ])
-
     def test_020_notify_updates_standalone(self):
         del self.src.template
         response = self.call_mgmt_func(b'qubes.NotifyUpdates', payload=b'1\n')
@@ -315,9 +218,7 @@ class TC_00_API_Misc(qubes.tests.QubesTestCase):
             mock.call.updateable.__bool__(),
         ])
         self.assertEqual(self.src.updates_available, True)
-        self.assertEqual(self.app.mock_calls, [
-            mock.call.save()
-        ])
+        self.assertEqual(self.app.mock_calls, [mock.call.save()])
 
     def test_021_notify_updates_standalone2(self):
         del self.src.template
diff --git a/qubes/tests/ext.py b/qubes/tests/ext.py
new file mode 100644
index 00000000..3dc229a2
--- /dev/null
+++ b/qubes/tests/ext.py
@@ -0,0 +1,177 @@
+# -*- encoding: utf8 -*-
+#
+# The Qubes OS Project, http://www.qubes-os.org
+#
+# Copyright (C) 2017 Marek Marczykowski-Górecki
+#                               <marmarek@invisiblethingslab.com>
+#
+# This program is free software; you can redistribute it and/or modify
+# it under the terms of the GNU General Public License as published by
+# the Free Software Foundation; either version 2 of the License, or
+# (at your option) any later version.
+#
+# This program is distributed in the hope that it will be useful,
+# but WITHOUT ANY WARRANTY; without even the implied warranty of
+# MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+# GNU General Public License for more details.
+#
+# You should have received a copy of the GNU General Public License along
+# with this program; if not, see <http://www.gnu.org/licenses/>.
+
+from unittest import mock
+
+import qubes.ext.core_features
+import qubes.tests
+
+
+class TC_00_CoreFeatures(qubes.tests.QubesTestCase):
+    def setUp(self):
+        super().setUp()
+        self.ext = qubes.ext.core_features.CoreFeatures()
+        self.vm = mock.MagicMock()
+        self.features = {}
+        self.vm.configure_mock(**{
+            'features.get.side_effect': self.features.get,
+            'features.__contains__.side_effect': self.features.__contains__,
+            'features.__setitem__.side_effect': self.features.__setitem__,
+            })
+
+    def test_010_notify_tools(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'gui': '1',
+                'version': '1',
+                'default-user': 'user',
+                'qrexec': '1'}),
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('qrexec',), {}),
+            ('features.__setitem__', ('qrexec', True), {}),
+            ('features.__contains__', ('gui',), {}),
+            ('features.__setitem__', ('gui', True), {}),
+            ('features.get', ('qrexec', False), {}),
+            ('fire_event', ('template-postinstall',), {})
+        ])
+
+    def test_011_notify_tools_uninstall(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'gui': '0',
+                'version': '1',
+                'default-user': 'user',
+                'qrexec': '0'}),
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('qrexec',), {}),
+            ('features.__setitem__', ('qrexec', False), {}),
+            ('features.__contains__', ('gui',), {}),
+            ('features.__setitem__', ('gui', False), {}),
+            ('features.get', ('qrexec', False), {}),
+        ])
+
+    def test_012_notify_tools_uninstall2(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'version': '1',
+                'default-user': 'user',
+            })
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.get', ('qrexec', False), {}),
+        ])
+
+    def test_013_notify_tools_no_version(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'qrexec': '1',
+                'gui': '1',
+                'default-user': 'user',
+            })
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('qrexec',), {}),
+            ('features.__setitem__', ('qrexec', True), {}),
+            ('features.__contains__', ('gui',), {}),
+            ('features.__setitem__', ('gui', True), {}),
+            ('features.get', ('qrexec', False), {}),
+            ('fire_event', ('template-postinstall',), {})
+        ])
+
+    def test_014_notify_tools_invalid_version(self):
+        del self.vm.template
+        with self.assertRaises(ValueError):
+            self.ext.qubes_features_request(self.vm, 'features-request',
+                untrusted_features={
+                    'version': 'this is invalid',
+                    'qrexec': '1',
+                    'gui': '1',
+                    'default-user': 'user',
+                })
+        self.assertEqual(self.vm.mock_calls, [])
+
+    def test_015_notify_tools_invalid_value_qrexec(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'version': '1',
+                'qrexec': 'invalid',
+                'gui': '1',
+                'default-user': 'user',
+            })
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('gui',), {}),
+            ('features.__setitem__', ('gui', True), {}),
+            ('features.get', ('qrexec', False), {}),
+        ])
+
+    def test_016_notify_tools_invalid_value_gui(self):
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'version': '1',
+                'qrexec': '1',
+                'gui': 'invalid',
+                'default-user': 'user',
+            })
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('qrexec',), {}),
+            ('features.__setitem__', ('qrexec', True), {}),
+            ('features.get', ('qrexec', False), {}),
+            ('fire_event', ('template-postinstall',), {})
+        ])
+
+    def test_017_notify_tools_template_based(self):
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'version': '1',
+                'qrexec': '1',
+                'gui': '1',
+                'default-user': 'user',
+            })
+        self.assertEqual(self.vm.mock_calls, [
+            ('template.__bool__', (), {}),
+            ('log.warning', ('Ignoring qubes.NotifyTools for template-based '
+                             'VM',), {})
+        ])
+
+    def test_018_notify_tools_already_installed(self):
+        self.features['qrexec'] = True
+        self.features['gui'] = True
+        del self.vm.template
+        self.ext.qubes_features_request(self.vm, 'features-request',
+            untrusted_features={
+                'gui': '1',
+                'version': '1',
+                'default-user': 'user',
+                'qrexec': '1'}),
+        self.assertEqual(self.vm.mock_calls, [
+            ('features.get', ('qrexec', False), {}),
+            ('features.__contains__', ('qrexec',), {}),
+            ('features.__contains__', ('gui',), {}),
+        ])
diff --git a/rpm_spec/core-dom0.spec b/rpm_spec/core-dom0.spec
index 4573836e..729df0ef 100644
--- a/rpm_spec/core-dom0.spec
+++ b/rpm_spec/core-dom0.spec
@@ -286,6 +286,7 @@ fi
 %{python3_sitelib}/qubes/ext/__pycache__/*
 %{python3_sitelib}/qubes/ext/__init__.py
 %{python3_sitelib}/qubes/ext/block.py
+%{python3_sitelib}/qubes/ext/core_features.py
 %{python3_sitelib}/qubes/ext/gui.py
 %{python3_sitelib}/qubes/ext/pci.py
 %{python3_sitelib}/qubes/ext/qubesmanager.py
@@ -304,6 +305,7 @@ fi
 %{python3_sitelib}/qubes/tests/devices.py
 %{python3_sitelib}/qubes/tests/devices_block.py
 %{python3_sitelib}/qubes/tests/events.py
+%{python3_sitelib}/qubes/tests/ext.py
 %{python3_sitelib}/qubes/tests/firewall.py
 %{python3_sitelib}/qubes/tests/init.py
 %{python3_sitelib}/qubes/tests/storage.py
diff --git a/setup.py b/setup.py
index 36360c26..0bcd0714 100644
--- a/setup.py
+++ b/setup.py
@@ -43,6 +43,7 @@ if __name__ == '__main__':
                 'DispVM = qubes.vm.dispvm:DispVM',
             ],
             'qubes.ext': [
+                'qubes.ext.core_features = qubes.ext.core_features:CoreFeatures',
                 'qubes.ext.qubesmanager = qubes.ext.qubesmanager:QubesManager',
                 'qubes.ext.gui = qubes.ext.gui:GUI',
                 'qubes.ext.r3compatibility = qubes.ext.r3compatibility:R3Compatibility',