diff --git a/core/src/plugins/kubernetes/helm/handlers.ts b/core/src/plugins/kubernetes/helm/handlers.ts
index 37ea1f4865..ef21746256 100644
--- a/core/src/plugins/kubernetes/helm/handlers.ts
+++ b/core/src/plugins/kubernetes/helm/handlers.ts
@@ -31,28 +31,28 @@ export const helmModuleHandlers: Partial<ModuleActionHandlers<HelmModule>> = {
       baseFields,
       tasks,
       tests,
-      dummyBuild,
+      dummyBuild: d,
       convertBuildDependency,
       prepareRuntimeDependencies,
     } = params
+    let dummyBuild = d
     const actions: (ExecBuildConfig | HelmActionConfig)[] = []
-
-    if (dummyBuild) {
-      actions.push(dummyBuild)
-    } else {
-      // We make a dummy build without a `copyFrom` or any build dependencies. This is to ensure there's a build action
-      // for this module if it's used as a base by another Helm module.
-      actions.push(makeDummyBuild({ module, copyFrom: undefined, dependencies: undefined }))
+    if (!dummyBuild) {
+      // We create a dummy build without a `copyFrom` or any build dependencies, to ensure there's a build action
+      // for this module. This is needed for compatibility reasions e.g. if there was a `base` field on the module
+      // or if a helm chart references dependent local charts relative to the modules build directory.
+      // We set the deploy actions `build` param to the dummy build to use the `buildPath` for all helm operations.
+      dummyBuild = makeDummyBuild({
+        module,
+        copyFrom: undefined,
+        dependencies: undefined,
+      })
     }
+    actions.push(dummyBuild)
 
     // There's one service on helm modules expect when skipDeploy = true
     const service: (typeof services)[0] | undefined = services[0]
 
-    // The helm Deploy type does not support the `base` field. We handle the field here during conversion,
-    // for compatibility.
-    // Note: A dummyBuild will be set if `base` is set on the Module, because the module configure handler then
-    //       sets a `build.dependencies[].copy` directive.
-
     let deployAction: HelmDeployConfig | null = null
 
     // If this Helm module has `skipDeploy = true`, there won't be a service config for us to convert here.
diff --git a/core/src/plugins/kubernetes/helm/module-config.ts b/core/src/plugins/kubernetes/helm/module-config.ts
index 327e9a9189..c942d988fe 100644
--- a/core/src/plugins/kubernetes/helm/module-config.ts
+++ b/core/src/plugins/kubernetes/helm/module-config.ts
@@ -210,7 +210,7 @@ export async function configureHelmModule({
     ]
   }
 
-  const yamlPath = join(module.path, chartPath, helmChartYamlFilename)
+  const yamlPath = join(moduleConfig.path, chartPath, helmChartYamlFilename)
   const containsSources = await pathExists(yamlPath)
 
   if (base) {
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/.helmignore b/core/test/data/test-projects/helm/chart-with-dependency-action/.helmignore
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/.helmignore
rename to core/test/data/test-projects/helm/chart-with-dependency-action/.helmignore
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/Chart.yaml b/core/test/data/test-projects/helm/chart-with-dependency-action/Chart.yaml
similarity index 80%
rename from core/test/data/test-projects/helm/chart-with-dependency/Chart.yaml
rename to core/test/data/test-projects/helm/chart-with-dependency-action/Chart.yaml
index 238013e9dd..a7a6d04d3d 100644
--- a/core/test/data/test-projects/helm/chart-with-dependency/Chart.yaml
+++ b/core/test/data/test-projects/helm/chart-with-dependency-action/Chart.yaml
@@ -11,3 +11,6 @@ dependencies:
   - name: postgresql
     version: "11.6.12"
     repository: https://charts.bitnami.com/bitnami
+  - name: frontend
+    version: 0.1.x
+    repository: file://../frontend
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-action/garden.yml b/core/test/data/test-projects/helm/chart-with-dependency-action/garden.yml
new file mode 100644
index 0000000000..abafe095fe
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-action/garden.yml
@@ -0,0 +1,10 @@
+kind: Deploy
+description: The API backend for the voting UI
+type: helm
+name: chart-with-dependency-action
+spec:
+  values:
+    image:
+      tag: ${modules.api-image.version}
+    ingress:
+      enabled: false
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-action/requirements.lock b/core/test/data/test-projects/helm/chart-with-dependency-action/requirements.lock
new file mode 100644
index 0000000000..9e84c2561a
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-action/requirements.lock
@@ -0,0 +1,9 @@
+dependencies:
+- name: postgresql
+  repository: https://charts.bitnami.com/bitnami
+  version: 11.6.12
+- name: frontend
+  repository: file://../frontend
+  version: 0.1.0
+digest: sha256:5dddf147b1f1210219f174a5f04547588622e606ff7d8ab890ff0e88fa85dbcd
+generated: "2023-10-04T18:21:23.739632+02:00"
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/templates/NOTES.txt b/core/test/data/test-projects/helm/chart-with-dependency-action/templates/NOTES.txt
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/templates/NOTES.txt
rename to core/test/data/test-projects/helm/chart-with-dependency-action/templates/NOTES.txt
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/templates/_helpers.tpl b/core/test/data/test-projects/helm/chart-with-dependency-action/templates/_helpers.tpl
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/templates/_helpers.tpl
rename to core/test/data/test-projects/helm/chart-with-dependency-action/templates/_helpers.tpl
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/templates/deployment.yaml b/core/test/data/test-projects/helm/chart-with-dependency-action/templates/deployment.yaml
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/templates/deployment.yaml
rename to core/test/data/test-projects/helm/chart-with-dependency-action/templates/deployment.yaml
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/templates/service.yaml b/core/test/data/test-projects/helm/chart-with-dependency-action/templates/service.yaml
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/templates/service.yaml
rename to core/test/data/test-projects/helm/chart-with-dependency-action/templates/service.yaml
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/values.yaml b/core/test/data/test-projects/helm/chart-with-dependency-action/values.yaml
similarity index 100%
rename from core/test/data/test-projects/helm/chart-with-dependency/values.yaml
rename to core/test/data/test-projects/helm/chart-with-dependency-action/values.yaml
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/.helmignore b/core/test/data/test-projects/helm/chart-with-dependency-module/.helmignore
new file mode 100644
index 0000000000..50af031725
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/.helmignore
@@ -0,0 +1,22 @@
+# Patterns to ignore when building packages.
+# This supports shell glob matching, relative path matching, and
+# negation (prefixed with !). Only one pattern per line.
+.DS_Store
+# Common VCS dirs
+.git/
+.gitignore
+.bzr/
+.bzrignore
+.hg/
+.hgignore
+.svn/
+# Common backup files
+*.swp
+*.bak
+*.tmp
+*~
+# Various IDEs
+.project
+.idea/
+*.tmproj
+.vscode/
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/Chart.yaml b/core/test/data/test-projects/helm/chart-with-dependency-module/Chart.yaml
new file mode 100644
index 0000000000..016690eb6a
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/Chart.yaml
@@ -0,0 +1,16 @@
+apiVersion: v1
+appVersion: "1.0"
+description: A Helm chart for Kubernetes
+name: chart-with-dependency
+version: 0.1.0
+image:
+  repository: busybox
+  tag: latest
+  pullPolicy: IfNotPresent
+dependencies:
+  - name: postgresql
+    version: "11.6.12"
+    repository: https://charts.bitnami.com/bitnami
+  - name: frontend
+    version: 0.1.x
+    repository: file://../../../frontend
diff --git a/core/test/data/test-projects/helm/chart-with-dependency/garden.yml b/core/test/data/test-projects/helm/chart-with-dependency-module/garden.yml
similarity index 86%
rename from core/test/data/test-projects/helm/chart-with-dependency/garden.yml
rename to core/test/data/test-projects/helm/chart-with-dependency-module/garden.yml
index 01a20a2d57..645fae941a 100644
--- a/core/test/data/test-projects/helm/chart-with-dependency/garden.yml
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/garden.yml
@@ -1,7 +1,7 @@
 kind: Module
 description: The API backend for the voting UI
 type: helm
-name: chart-with-dependency
+name: chart-with-dependency-module
 serviceResource:
   kind: Deployment
   containerModule: api-image
@@ -10,4 +10,3 @@ values:
     tag: ${modules.api-image.version}
   ingress:
     enabled: false
-
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/templates/NOTES.txt b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/NOTES.txt
new file mode 100644
index 0000000000..4eab4da896
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/NOTES.txt
@@ -0,0 +1,21 @@
+1. Get the application URL by running these commands:
+{{- if .Values.ingress.enabled }}
+{{- range $host := .Values.ingress.hosts }}
+  {{- range $.Values.ingress.paths }}
+  http{{ if $.Values.ingress.tls }}s{{ end }}://{{ $host }}{{ . }}
+  {{- end }}
+{{- end }}
+{{- else if contains "NodePort" .Values.service.type }}
+  export NODE_PORT=$(kubectl get --namespace {{ .Release.Namespace }} -o jsonpath="{.spec.ports[0].nodePort}" services {{ include "chart-with-namespace.fullname" . }})
+  export NODE_IP=$(kubectl get nodes --namespace {{ .Release.Namespace }} -o jsonpath="{.items[0].status.addresses[0].address}")
+  echo http://$NODE_IP:$NODE_PORT
+{{- else if contains "LoadBalancer" .Values.service.type }}
+     NOTE: It may take a few minutes for the LoadBalancer IP to be available.
+           You can watch the status of by running 'kubectl get svc -w {{ include "chart-with-namespace.fullname" . }}'
+  export SERVICE_IP=$(kubectl get svc --namespace {{ .Release.Namespace }} {{ include "chart-with-namespace.fullname" . }} -o jsonpath='{.status.loadBalancer.ingress[0].ip}')
+  echo http://$SERVICE_IP:{{ .Values.service.port }}
+{{- else if contains "ClusterIP" .Values.service.type }}
+  export POD_NAME=$(kubectl get pods --namespace {{ .Release.Namespace }} -l "app.kubernetes.io/name={{ include "chart-with-namespace.name" . }},app.kubernetes.io/instance={{ .Release.Name }}" -o jsonpath="{.items[0].metadata.name}")
+  echo "Visit http://127.0.0.1:8080 to use your application"
+  kubectl port-forward $POD_NAME 8080:80
+{{- end }}
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/templates/_helpers.tpl b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/_helpers.tpl
new file mode 100644
index 0000000000..1381901f29
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/_helpers.tpl
@@ -0,0 +1,32 @@
+{{/* vim: set filetype=mustache: */}}
+{{/*
+Expand the name of the chart.
+*/}}
+{{- define "chart-with-namespace.name" -}}
+{{- default .Chart.Name .Values.nameOverride | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
+
+{{/*
+Create a default fully qualified app name.
+We truncate at 63 chars because some Kubernetes name fields are limited to this (by the DNS naming spec).
+If release name contains chart name it will be used as a full name.
+*/}}
+{{- define "chart-with-namespace.fullname" -}}
+{{- if .Values.fullnameOverride -}}
+{{- .Values.fullnameOverride | trunc 63 | trimSuffix "-" -}}
+{{- else -}}
+{{- $name := default .Chart.Name .Values.nameOverride -}}
+{{- if contains $name .Release.Name -}}
+{{- .Release.Name | trunc 63 | trimSuffix "-" -}}
+{{- else -}}
+{{- printf "%s-%s" .Release.Name $name | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
+{{- end -}}
+{{- end -}}
+
+{{/*
+Create chart name and version as used by the chart label.
+*/}}
+{{- define "chart-with-namespace.chart" -}}
+{{- printf "%s-%s" .Chart.Name .Chart.Version | replace "+" "_" | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/templates/deployment.yaml b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/deployment.yaml
new file mode 100644
index 0000000000..c394c35cc0
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/deployment.yaml
@@ -0,0 +1,49 @@
+apiVersion: apps/v1
+kind: Deployment
+metadata:
+  name: {{ include "chart-with-namespace.fullname" . }}
+  labels:
+    app.kubernetes.io/name: {{ include "chart-with-namespace.name" . }}
+    helm.sh/chart: {{ include "chart-with-namespace.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+spec:
+  replicas: {{ .Values.replicaCount }}
+  selector:
+    matchLabels:
+      app.kubernetes.io/name: {{ include "chart-with-namespace.name" . }}
+      app.kubernetes.io/instance: {{ .Release.Name }}
+  template:
+    metadata:
+      labels:
+        app.kubernetes.io/name: {{ include "chart-with-namespace.name" . }}
+        app.kubernetes.io/instance: {{ .Release.Name }}
+    spec:
+      containers:
+        - name: {{ .Chart.Name }}
+          image: "{{ .Values.image.repository }}:{{ .Values.image.tag }}"
+          imagePullPolicy: {{ .Values.image.pullPolicy }}
+          args: [python, app.py]
+          ports:
+            - name: http
+              containerPort: 80
+              protocol: TCP
+          env:
+            - name: POD_NAMESPACE
+              valueFrom:
+                fieldRef:
+                  fieldPath: metadata.namespace
+          resources:
+            {{- toYaml .Values.resources | nindent 12 }}
+      {{- with .Values.nodeSelector }}
+      nodeSelector:
+        {{- toYaml . | nindent 8 }}
+      {{- end }}
+    {{- with .Values.affinity }}
+      affinity:
+        {{- toYaml . | nindent 8 }}
+    {{- end }}
+    {{- with .Values.tolerations }}
+      tolerations:
+        {{- toYaml . | nindent 8 }}
+    {{- end }}
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/templates/service.yaml b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/service.yaml
new file mode 100644
index 0000000000..d77cd81690
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/templates/service.yaml
@@ -0,0 +1,19 @@
+apiVersion: v1
+kind: Service
+metadata:
+  name: {{ include "chart-with-namespace.fullname" . }}
+  labels:
+    app.kubernetes.io/name: {{ include "chart-with-namespace.name" . }}
+    helm.sh/chart: {{ include "chart-with-namespace.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+spec:
+  type: {{ .Values.service.type }}
+  ports:
+    - port: {{ .Values.service.port }}
+      targetPort: http
+      protocol: TCP
+      name: http
+  selector:
+    app.kubernetes.io/name: {{ include "chart-with-namespace.name" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
diff --git a/core/test/data/test-projects/helm/chart-with-dependency-module/values.yaml b/core/test/data/test-projects/helm/chart-with-dependency-module/values.yaml
new file mode 100644
index 0000000000..200d11a04d
--- /dev/null
+++ b/core/test/data/test-projects/helm/chart-with-dependency-module/values.yaml
@@ -0,0 +1,48 @@
+# Default values for chart-with-namespace.
+# This is a YAML-formatted file.
+# Declare variables to be passed into your templates.
+
+replicaCount: 1
+
+image:
+  repository: api-image
+  tag: stable
+  pullPolicy: IfNotPresent
+
+nameOverride: ""
+fullnameOverride: ""
+
+service:
+  type: ClusterIP
+  port: 80
+
+ingress:
+  enabled: false
+  annotations: {}
+    # kubernetes.io/ingress.class: nginx
+    # kubernetes.io/tls-acme: "true"
+  paths: []
+  hosts:
+    - chart-example.local
+  tls: []
+  #  - secretName: chart-example-tls
+  #    hosts:
+  #      - chart-example.local
+
+resources: {}
+  # We usually recommend not to specify default resources and to leave this as a conscious
+  # choice for the user. This also increases chances charts run on environments with little
+  # resources, such as Minikube. If you do want to specify resources, uncomment the following
+  # lines, adjust them as necessary, and remove the curly braces after 'resources:'.
+  # limits:
+  #  cpu: 100m
+  #  memory: 128Mi
+  # requests:
+  #  cpu: 100m
+  #  memory: 128Mi
+
+nodeSelector: {}
+
+tolerations: []
+
+affinity: {}
diff --git a/core/test/data/test-projects/helm/frontend/.helmignore b/core/test/data/test-projects/helm/frontend/.helmignore
new file mode 100644
index 0000000000..50af031725
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/.helmignore
@@ -0,0 +1,22 @@
+# Patterns to ignore when building packages.
+# This supports shell glob matching, relative path matching, and
+# negation (prefixed with !). Only one pattern per line.
+.DS_Store
+# Common VCS dirs
+.git/
+.gitignore
+.bzr/
+.bzrignore
+.hg/
+.hgignore
+.svn/
+# Common backup files
+*.swp
+*.bak
+*.tmp
+*~
+# Various IDEs
+.project
+.idea/
+*.tmproj
+.vscode/
diff --git a/core/test/data/test-projects/helm/frontend/Chart.yaml b/core/test/data/test-projects/helm/frontend/Chart.yaml
new file mode 100644
index 0000000000..9f9cc0aa03
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/Chart.yaml
@@ -0,0 +1,9 @@
+apiVersion: v1
+appVersion: "1.0"
+description: A Helm chart for Kubernetes
+name: frontend
+version: 0.1.0
+image:
+  repository: busybox
+  tag: latest
+  pullPolicy: IfNotPresent
diff --git a/core/test/data/test-projects/helm/frontend/templates/NOTES.txt b/core/test/data/test-projects/helm/frontend/templates/NOTES.txt
new file mode 100644
index 0000000000..99b663b391
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/templates/NOTES.txt
@@ -0,0 +1,21 @@
+1. Get the application URL by running these commands:
+{{- if .Values.ingress.enabled }}
+{{- range $host := .Values.ingress.hosts }}
+  {{- range $.Values.ingress.paths }}
+  http{{ if $.Values.ingress.tls }}s{{ end }}://{{ $host }}{{ . }}
+  {{- end }}
+{{- end }}
+{{- else if contains "NodePort" .Values.service.type }}
+  export NODE_PORT=$(kubectl get --namespace {{ .Release.Namespace }} -o jsonpath="{.spec.ports[0].nodePort}" services {{ include "frontend.fullname" . }})
+  export NODE_IP=$(kubectl get nodes --namespace {{ .Release.Namespace }} -o jsonpath="{.items[0].status.addresses[0].address}")
+  echo http://$NODE_IP:$NODE_PORT
+{{- else if contains "LoadBalancer" .Values.service.type }}
+     NOTE: It may take a few minutes for the LoadBalancer IP to be available.
+           You can watch the status of by running 'kubectl get svc -w {{ include "frontend.fullname" . }}'
+  export SERVICE_IP=$(kubectl get svc --namespace {{ .Release.Namespace }} {{ include "frontend.fullname" . }} -o jsonpath='{.status.loadBalancer.ingress[0].ip}')
+  echo http://$SERVICE_IP:{{ .Values.service.port }}
+{{- else if contains "ClusterIP" .Values.service.type }}
+  export POD_NAME=$(kubectl get pods --namespace {{ .Release.Namespace }} -l "app.kubernetes.io/name={{ include "frontend.name" . }},app.kubernetes.io/instance={{ .Release.Name }}" -o jsonpath="{.items[0].metadata.name}")
+  echo "Visit http://127.0.0.1:8080 to use your application"
+  kubectl port-forward $POD_NAME 8080:80
+{{- end }}
diff --git a/core/test/data/test-projects/helm/frontend/templates/_helpers.tpl b/core/test/data/test-projects/helm/frontend/templates/_helpers.tpl
new file mode 100644
index 0000000000..99f6e20845
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/templates/_helpers.tpl
@@ -0,0 +1,32 @@
+{{/* vim: set filetype=mustache: */}}
+{{/*
+Expand the name of the chart.
+*/}}
+{{- define "frontend.name" -}}
+{{- default .Chart.Name .Values.nameOverride | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
+
+{{/*
+Create a default fully qualified app name.
+We truncate at 63 chars because some Kubernetes name fields are limited to this (by the DNS naming spec).
+If release name contains chart name it will be used as a full name.
+*/}}
+{{- define "frontend.fullname" -}}
+{{- if .Values.fullnameOverride -}}
+{{- .Values.fullnameOverride | trunc 63 | trimSuffix "-" -}}
+{{- else -}}
+{{- $name := default .Chart.Name .Values.nameOverride -}}
+{{- if contains $name .Release.Name -}}
+{{- .Release.Name | trunc 63 | trimSuffix "-" -}}
+{{- else -}}
+{{- printf "%s-%s" .Release.Name $name | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
+{{- end -}}
+{{- end -}}
+
+{{/*
+Create chart name and version as used by the chart label.
+*/}}
+{{- define "frontend.chart" -}}
+{{- printf "%s-%s" .Chart.Name .Chart.Version | replace "+" "_" | trunc 63 | trimSuffix "-" -}}
+{{- end -}}
diff --git a/core/test/data/test-projects/helm/frontend/templates/deployment.yaml b/core/test/data/test-projects/helm/frontend/templates/deployment.yaml
new file mode 100644
index 0000000000..22a6246871
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/templates/deployment.yaml
@@ -0,0 +1,44 @@
+apiVersion: apps/v1
+kind: Deployment
+metadata:
+  name: {{ include "frontend.fullname" . }}
+  labels:
+    app.kubernetes.io/name: {{ include "frontend.name" . }}
+    helm.sh/chart: {{ include "frontend.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+spec:
+  replicas: {{ .Values.replicaCount }}
+  selector:
+    matchLabels:
+      app.kubernetes.io/name: {{ include "frontend.name" . }}
+      app.kubernetes.io/instance: {{ .Release.Name }}
+  template:
+    metadata:
+      labels:
+        app.kubernetes.io/name: {{ include "frontend.name" . }}
+        app.kubernetes.io/instance: {{ .Release.Name }}
+    spec:
+      shareProcessNamespace: {{ .Values.shareProcessNamespace }}
+      containers:
+        - name: {{ .Chart.Name }}
+          image: "{{ .Values.image.repository }}:{{ .Values.image.tag }}"
+          imagePullPolicy: {{ .Values.image.pullPolicy }}
+          ports:
+            - name: http
+              containerPort: 80
+              protocol: TCP
+          resources:
+            {{- toYaml .Values.resources | nindent 12 }}
+      {{- with .Values.nodeSelector }}
+      nodeSelector:
+        {{- toYaml . | nindent 8 }}
+      {{- end }}
+    {{- with .Values.affinity }}
+      affinity:
+        {{- toYaml . | nindent 8 }}
+    {{- end }}
+    {{- with .Values.tolerations }}
+      tolerations:
+        {{- toYaml . | nindent 8 }}
+    {{- end }}
diff --git a/core/test/data/test-projects/helm/frontend/templates/ingress.yaml b/core/test/data/test-projects/helm/frontend/templates/ingress.yaml
new file mode 100644
index 0000000000..a6573efc65
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/templates/ingress.yaml
@@ -0,0 +1,90 @@
+{{- if .Values.ingress.enabled -}}
+{{- $fullName := include "frontend.fullname" . -}}
+{{- $ingressPaths := .Values.ingress.paths -}}
+
+{{- if .Capabilities.APIVersions.Has "networking.k8s.io/v1/Ingress" -}}
+
+# Use the new Ingress manifest structure
+apiVersion: networking.k8s.io/v1
+kind: Ingress
+metadata:
+  name: {{ $fullName }}
+  labels:
+    app.kubernetes.io/name: {{ include "frontend.name" . }}
+    helm.sh/chart: {{ include "frontend.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+  {{- with .Values.ingress.annotations }}
+  annotations:
+    {{- toYaml . | nindent 4 }}
+  {{- end }}
+spec:
+{{- if .Values.ingress.tls }}
+  tls:
+  {{- range .Values.ingress.tls }}
+    - hosts:
+      {{- range .hosts }}
+        - {{ . | quote }}
+      {{- end }}
+      secretName: {{ .secretName }}
+  {{- end }}
+{{- end }}
+  rules:
+  {{- range .Values.ingress.hosts }}
+    - host: {{ . | quote }}
+      http:
+        paths:
+	{{- range $ingressPaths }}
+          - path: {{ . }}
+            pathType: Prefix
+            backend:
+              service:
+                name: {{ $fullName }}
+                port:
+                  number: 80
+	{{- end }}
+  {{- end }}
+
+{{- else -}}
+
+# Use the old Ingress manifest structure
+apiVersion: extensions/v1beta1
+kind: Ingress
+metadata:
+  name: {{ $fullName }}
+  labels:
+    app.kubernetes.io/name: {{ include "frontend.name" . }}
+    helm.sh/chart: {{ include "frontend.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+  {{- with .Values.ingress.annotations }}
+  annotations:
+    {{- toYaml . | nindent 4 }}
+  {{- end }}
+spec:
+{{- if .Values.ingress.tls }}
+  tls:
+  {{- range .Values.ingress.tls }}
+    - hosts:
+      {{- range .hosts }}
+        - {{ . | quote }}
+      {{- end }}
+      secretName: {{ .secretName }}
+  {{- end }}
+{{- end }}
+  rules:
+  {{- range .Values.ingress.hosts }}
+    - host: {{ . | quote }}
+      http:
+        paths:
+	{{- range $ingressPaths }}
+          - path: {{ . }}
+            backend:
+              serviceName: {{ $fullName }}
+              servicePort: http
+	{{- end }}
+  {{- end }}
+
+
+{{- end }}
+{{- end }}
diff --git a/core/test/data/test-projects/helm/frontend/templates/service.yaml b/core/test/data/test-projects/helm/frontend/templates/service.yaml
new file mode 100644
index 0000000000..c396536dd8
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/templates/service.yaml
@@ -0,0 +1,19 @@
+apiVersion: v1
+kind: Service
+metadata:
+  name: {{ include "frontend.fullname" . }}
+  labels:
+    app.kubernetes.io/name: {{ include "frontend.name" . }}
+    helm.sh/chart: {{ include "frontend.chart" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
+    app.kubernetes.io/managed-by: {{ .Release.Service }}
+spec:
+  type: {{ .Values.service.type }}
+  ports:
+    - port: {{ .Values.service.port }}
+      targetPort: http
+      protocol: TCP
+      name: http
+  selector:
+    app.kubernetes.io/name: {{ include "frontend.name" . }}
+    app.kubernetes.io/instance: {{ .Release.Name }}
diff --git a/core/test/data/test-projects/helm/frontend/values.yaml b/core/test/data/test-projects/helm/frontend/values.yaml
new file mode 100644
index 0000000000..2c16cf23dc
--- /dev/null
+++ b/core/test/data/test-projects/helm/frontend/values.yaml
@@ -0,0 +1,51 @@
+# Default values for frontend.
+# This is a YAML-formatted file.
+# Declare variables to be passed into your templates.
+
+replicaCount: 1
+
+image:
+  repository: nginx
+  tag: latest
+  pullPolicy: IfNotPresent
+
+nameOverride: ""
+fullnameOverride: ""
+
+service:
+  type: ClusterIP
+  port: 80
+
+ingress:
+  enabled: false
+  annotations: {}
+    # kubernetes.io/ingress.class: nginx
+    # kubernetes.io/tls-acme: "true"
+  paths: []
+  hosts:
+    - chart-example.local
+  tls: []
+  #  - secretName: chart-example-tls
+  #    hosts:
+  #      - chart-example.local
+
+resources: {}
+  # We usually recommend not to specify default resources and to leave this as a conscious
+  # choice for the user. This also increases chances charts run on environments with little
+  # resources, such as Minikube. If you do want to specify resources, uncomment the following
+  # lines, adjust them as necessary, and remove the curly braces after 'resources:'.
+  # limits:
+  #  cpu: 100m
+  #  memory: 128Mi
+  # requests:
+  #  cpu: 100m
+  #  memory: 128Mi
+
+# This field is whitelisted in `runPodSpecWhitelist`, so it should be included when running tests/tasks
+shareProcessNamespace: true
+
+nodeSelector: {}
+
+tolerations: []
+
+affinity: {}
diff --git a/core/test/integ/src/plugins/kubernetes/helm/common.ts b/core/test/integ/src/plugins/kubernetes/helm/common.ts
index ac02786400..98cf58acf8 100644
--- a/core/test/integ/src/plugins/kubernetes/helm/common.ts
+++ b/core/test/integ/src/plugins/kubernetes/helm/common.ts
@@ -668,9 +668,9 @@ ${expectedIngressOutput}
         expect(pathFiles).to.include("Chart.yaml")
       })
 
-      it("updates dependencies for local charts", async () => {
+      it("updates dependencies for local charts in build dir for modules", async () => {
         const action = await garden.resolveAction<HelmDeployAction>({
-          action: graph.getDeploy("chart-with-dependency"),
+          action: graph.getDeploy("chart-with-dependency-module"),
           log,
           graph,
         })
@@ -682,10 +682,51 @@ ${expectedIngressOutput}
 
         const helmDependencyUpdateLogLine = log.entries.find(
           ({ msg }) =>
-            msg?.includes("helm") && msg?.includes("dependency update") && msg.includes("chart-with-dependency")
+            msg?.includes("helm") && msg?.includes("dependency update") && msg.includes("chart-with-dependency-module")
         )
         expect(helmDependencyUpdateLogLine).to.exist
       })
+
+      it("updates dependencies for local charts in action dir for native actions", async () => {
+        const action = await garden.resolveAction<HelmDeployAction>({
+          action: graph.getDeploy("chart-with-dependency-action"),
+          log,
+          graph,
+        })
+
+        const l = log as any
+        l.entries = []
+
+        await prepareTemplates({ ctx, log, action })
+
+        const helmDependencyUpdateLogLine = log.entries.find(
+          ({ msg }) =>
+            msg?.includes("helm") && msg?.includes("dependency update") && msg.includes("chart-with-dependency-action")
+        )
+        expect(helmDependencyUpdateLogLine).to.exist
+      })
+
+      it("uses build directory for deploy actions converted from Helm modules", async () => {
+        const action = await garden.resolveAction<HelmDeployAction>({
+          action: graph.getDeploy("chart-with-dependency-module"),
+          log,
+          graph,
+        })
+        const buildPath = action.getBuildAction()?.getBuildPath()
+        const chartPath = await getChartPath(action)
+        expect(chartPath).to.equal(buildPath)
+      })
+
+      it("uses action directory for native deploy actions", async () => {
+        const action = await garden.resolveAction<HelmDeployAction>({
+          action: graph.getDeploy("chart-with-dependency-action"),
+          log,
+          graph,
+        })
+        const buildPath = action.getBuildAction()?.getBuildPath()
+        const chartPath = await getChartPath(action)
+        expect(chartPath).to.not.equal(buildPath)
+      })
     })
 
     context("chart.url is set", () => {
diff --git a/core/test/integ/src/plugins/kubernetes/helm/config.ts b/core/test/integ/src/plugins/kubernetes/helm/config.ts
index c3b7c57541..5d3ed85e54 100644
--- a/core/test/integ/src/plugins/kubernetes/helm/config.ts
+++ b/core/test/integ/src/plugins/kubernetes/helm/config.ts
@@ -107,7 +107,7 @@ describe("configureHelmModule", () => {
       description: "The API backend for the voting UI",
       disabled: false,
       generateFiles: undefined,
-      include: ["*.yaml", "*.yml"],
+      include: ["*", "charts/**/*", "templates/**/*"],
       inputs: {},
       exclude: undefined,
       name: "api-module",