diff --git a/docs/developer-guide/udf.rst b/docs/developer-guide/udf.rst
index 85e7dbb89e18..b42c046c2cba 100644
--- a/docs/developer-guide/udf.rst
+++ b/docs/developer-guide/udf.rst
@@ -113,7 +113,7 @@ implement a UDF with a non-deterministic return type. A UDF which returns ``BigD
 for example, may vary the precision and scale of the output based on the input schema.
 
 To use this functionality, you need to specify a method with signature
-``public Schema <your-method-name>(final List<Schema> params)`` and annotate it with ``@SchemaProvider``.
+``public SqlType <your-method-name>(final List<SqlType> params)`` and annotate it with ``@SchemaProvider``.
 Also, you need to link it to the corresponding UDF by using the ``schemaProvider=<your-method-name>``
 parameter of the ``@Udf`` annotation.
 
diff --git a/ksql-common/src/main/java/io/confluent/ksql/function/KsqlFunction.java b/ksql-common/src/main/java/io/confluent/ksql/function/KsqlFunction.java
index c3b5928f2701..ee7e4e01a487 100644
--- a/ksql-common/src/main/java/io/confluent/ksql/function/KsqlFunction.java
+++ b/ksql-common/src/main/java/io/confluent/ksql/function/KsqlFunction.java
@@ -18,6 +18,7 @@
 import com.google.common.collect.ImmutableList;
 import com.google.common.collect.Iterables;
 import io.confluent.ksql.function.udf.Kudf;
+import io.confluent.ksql.schema.ksql.SchemaConverters;
 import io.confluent.ksql.util.KsqlConfig;
 import io.confluent.ksql.util.KsqlException;
 import io.confluent.ksql.util.SchemaUtil;
@@ -177,9 +178,11 @@ private void checkMatchingReturnTypes(final Schema s1, final Schema s2) {
     if (!SchemaUtil.areCompatible(s1, s2)) {
       throw new KsqlException(String.format("Return type %s of UDF %s does not match the declared "
                                                 + "return type %s.",
-                                            s1.toString(),
+                                            SchemaConverters.connectToSqlConverter().toSqlType(
+                                                s1).toString(),
                                             functionName,
-                                            s2.toString()));
+                                            SchemaConverters.connectToSqlConverter().toSqlType(
+                                                s2).toString()));
     }
   }
 
diff --git a/ksql-engine/src/main/java/io/confluent/ksql/function/UdfLoader.java b/ksql-engine/src/main/java/io/confluent/ksql/function/UdfLoader.java
index ed6a54fd6465..ac61e266f7e1 100644
--- a/ksql-engine/src/main/java/io/confluent/ksql/function/UdfLoader.java
+++ b/ksql-engine/src/main/java/io/confluent/ksql/function/UdfLoader.java
@@ -28,6 +28,7 @@
 import io.confluent.ksql.metrics.MetricCollectors;
 import io.confluent.ksql.schema.ksql.SchemaConverters;
 import io.confluent.ksql.schema.ksql.TypeContextUtil;
+import io.confluent.ksql.schema.ksql.types.SqlType;
 import io.confluent.ksql.security.ExtensionSecurityManager;
 import io.confluent.ksql.util.DecimalUtil;
 import io.confluent.ksql.util.KsqlConfig;
@@ -404,8 +405,12 @@ private Function<List<Schema>,Schema> handleUdfSchemaProviderAnnotation(
     final Method m = findSchemaProvider(theClass, schemaProviderName);
     final Object instance = instantiateUdfClass(theClass, annotation);
 
-    return parameterTypes -> {
-      return invokeSchemaProviderMethod(instance, m, parameterTypes, annotation);
+    return parameterSchemas -> {
+      final List<SqlType> parameterTypes = parameterSchemas.stream()
+          .map(p -> SchemaConverters.connectToSqlConverter().toSqlType(p))
+          .collect(Collectors.toList());
+      return SchemaConverters.sqlToConnectConverter().toConnectSchema(invokeSchemaProviderMethod(
+          instance, m, parameterTypes, annotation));
     };
   }
 
@@ -421,15 +426,17 @@ private Method findSchemaProvider(final Class<?> theClass,
       return m;
     } catch (NoSuchMethodException e) {
       throw new KsqlException(String.format(
-          "Cannot find schema provider method with name %s and parameter List<Schema> in class %s.",
-          schemaProviderName,theClass.getName()),e);
+          "Cannot find schema provider method with name %s and parameter List<SqlType> in class "
+              + "%s.", schemaProviderName,theClass.getName()),e);
     }
   }
 
-  private Schema invokeSchemaProviderMethod(final Object instance, final Method m,
-      final List<Schema> args, final UdfDescription annotation) {
+  private SqlType invokeSchemaProviderMethod(final Object instance,
+                                            final Method m,
+                                            final List<SqlType> args,
+                                            final UdfDescription annotation) {
     try {
-      return (Schema) m.invoke(instance, args);
+      return (SqlType) m.invoke(instance, args);
     } catch (IllegalAccessException
         | InvocationTargetException e) {
       throw new KsqlException(String.format("Cannot invoke the schema provider "
diff --git a/ksql-engine/src/main/java/io/confluent/ksql/function/udf/math/Abs.java b/ksql-engine/src/main/java/io/confluent/ksql/function/udf/math/Abs.java
index 5f0fff13a646..017f9d9c0980 100644
--- a/ksql-engine/src/main/java/io/confluent/ksql/function/udf/math/Abs.java
+++ b/ksql-engine/src/main/java/io/confluent/ksql/function/udf/math/Abs.java
@@ -19,11 +19,11 @@
 import io.confluent.ksql.function.udf.UdfDescription;
 import io.confluent.ksql.function.udf.UdfParameter;
 import io.confluent.ksql.function.udf.UdfSchemaProvider;
-import io.confluent.ksql.util.DecimalUtil;
+import io.confluent.ksql.schema.ksql.SqlBaseType;
+import io.confluent.ksql.schema.ksql.types.SqlType;
 import io.confluent.ksql.util.KsqlException;
 import java.math.BigDecimal;
 import java.util.List;
-import org.apache.kafka.connect.data.Schema;
 
 @UdfDescription(name = "Abs", description = Abs.DESCRIPTION)
 public class Abs {
@@ -54,12 +54,12 @@ public BigDecimal abs(@UdfParameter final BigDecimal val) {
   }
 
   @UdfSchemaProvider
-  public Schema provideSchema(final List<Schema> params) {
+  public SqlType provideSchema(final List<SqlType> params) {
     if (params.size() != 1) {
       throw new KsqlException("Abs udf accepts one parameter");
     }
-    final Schema s = params.get(0);
-    if (!DecimalUtil.isDecimal(s)) {
+    final SqlType s = params.get(0);
+    if (s.baseType() != SqlBaseType.DECIMAL) {
       throw new KsqlException("The schema provider method for Abs expects a BigDecimal parameter"
           + "type");
     }
diff --git a/ksql-engine/src/test/java/io/confluent/ksql/function/UdfLoaderTest.java b/ksql-engine/src/test/java/io/confluent/ksql/function/UdfLoaderTest.java
index da7e7957aef5..ac5a8e324e0e 100644
--- a/ksql-engine/src/test/java/io/confluent/ksql/function/UdfLoaderTest.java
+++ b/ksql-engine/src/test/java/io/confluent/ksql/function/UdfLoaderTest.java
@@ -36,6 +36,8 @@
 import io.confluent.ksql.function.udf.UdfDescription;
 import io.confluent.ksql.function.udf.UdfParameter;
 import io.confluent.ksql.function.udf.UdfSchemaProvider;
+import io.confluent.ksql.schema.ksql.types.SqlDecimal;
+import io.confluent.ksql.schema.ksql.types.SqlType;
 import io.confluent.ksql.util.DecimalUtil;
 import io.confluent.ksql.util.KsqlConfig;
 import io.confluent.ksql.util.KsqlException;
@@ -246,9 +248,8 @@ public void shouldThrowOnReturnTypeMismatch() {
 
     // Expect:
     expectedException.expect(KsqlException.class);
-    expectedException.expectMessage(is("Return type Schema{org.apache.kafka.connect.data."
-                                           + "Decimal:BYTES} of UDF ReturnIncompatible does not "
-                                           + "match the declared return type Schema{STRING}."));
+    expectedException.expectMessage(is("Return type DECIMAL(2, 1) of UDF ReturnIncompatible does not "
+                                           + "match the declared return type STRING."));
 
     // When:
     function.getReturnType(args);
@@ -301,7 +302,7 @@ public void shouldThrowOnMissingSchemaProvider() throws ClassNotFoundException {
     // Expect:
     expectedException.expect(KsqlException.class);
     expectedException.expectMessage(is("Cannot find schema provider method with name provideSchema "
-                                           + "and parameter List<Schema> in class org.damian.ksql.udf."
+                                           + "and parameter List<SqlType> in class org.damian.ksql.udf."
                                            + "MissingSchemaProviderUdf."));
 
     /// When:
@@ -671,8 +672,8 @@ public BigDecimal foo(@UdfParameter("justValue") final BigDecimal p) {
     }
 
     @UdfSchemaProvider
-    public Schema provideSchema(List<Schema> params) {
-      return DecimalUtil.builder(2, 1).build();
+    public SqlType provideSchema(List<SqlType> params) {
+      return SqlDecimal.of(2, 1);
     }
   }
 
@@ -689,8 +690,8 @@ public String foo(@UdfParameter("justValue") final BigDecimal p) {
     }
 
     @UdfSchemaProvider
-    public Schema provideSchema(List<Schema> params) {
-      return DecimalUtil.builder(2, 1).build();
+    public SqlType provideSchema(List<Schema> params) {
+      return SqlDecimal.of(2, 1);
     }
   }
 }
\ No newline at end of file
diff --git a/ksql-engine/src/test/resources/udf-failing-tests.jar b/ksql-engine/src/test/resources/udf-failing-tests.jar
index be374a0909c9..f96cfa98040b 100644
Binary files a/ksql-engine/src/test/resources/udf-failing-tests.jar and b/ksql-engine/src/test/resources/udf-failing-tests.jar differ
diff --git a/ksql-engine/src/test/resources/udf-failing-tests/src/main/java/org/damian/ksql/udf/MissingAnnotationUdf.java b/ksql-engine/src/test/resources/udf-failing-tests/src/main/java/org/damian/ksql/udf/MissingAnnotationUdf.java
index d6455098cb00..00e2b35aab69 100644
--- a/ksql-engine/src/test/resources/udf-failing-tests/src/main/java/org/damian/ksql/udf/MissingAnnotationUdf.java
+++ b/ksql-engine/src/test/resources/udf-failing-tests/src/main/java/org/damian/ksql/udf/MissingAnnotationUdf.java
@@ -19,6 +19,8 @@
 import io.confluent.ksql.function.udf.UdfDescription;
 import io.confluent.ksql.function.udf.UdfParameter;
 import io.confluent.ksql.function.udf.UdfSchemaProvider;
+import io.confluent.ksql.schema.ksql.types.SqlDecimal;
+import io.confluent.ksql.schema.ksql.types.SqlType;
 import io.confluent.ksql.util.DecimalUtil;
 import java.math.BigDecimal;
 import java.util.List;
@@ -41,7 +43,7 @@ public BigDecimal foo(@UdfParameter("justValue") final BigDecimal p) {
   }
 
   @UdfSchemaProvider
-  public Schema provideSchema(List<Schema> params) {
-    return DecimalUtil.builder(2, 1).build();
+  public SqlType provideSchema(List<SqlType> params) {
+    return SqlDecimal.of(2, 1);
   }
 }
diff --git a/ksql-streams/pom.xml b/ksql-streams/pom.xml
index 40d9b26c9be5..a247d84682e9 100644
--- a/ksql-streams/pom.xml
+++ b/ksql-streams/pom.xml
@@ -69,6 +69,10 @@
             <version>${project.version}</version>
             <scope>test</scope>
         </dependency>
+      <dependency>
+        <groupId>io.confluent.ksql</groupId>
+        <artifactId>ksql-common</artifactId>
+      </dependency>
 
     </dependencies>