diff --git a/android/capacitor/src/main/java/com/getcapacitor/plugin/SystemBars.java b/android/capacitor/src/main/java/com/getcapacitor/plugin/SystemBars.java
index 3f04adf976..c84923ca8b 100644
--- a/android/capacitor/src/main/java/com/getcapacitor/plugin/SystemBars.java
+++ b/android/capacitor/src/main/java/com/getcapacitor/plugin/SystemBars.java
@@ -7,7 +7,6 @@
 import android.os.Build;
 import android.util.TypedValue;
 import android.view.View;
-import android.view.ViewGroup;
 import android.view.Window;
 import android.webkit.JavascriptInterface;
 import android.webkit.WebView;
@@ -36,6 +35,11 @@ public class SystemBars extends Plugin {
     static final String INSETS_HANDLING_CSS = "css";
     static final String INSETS_HANDLING_DISABLE = "disable";
 
+    // https://issues.chromium.org/issues/40699457
+    private static final int WEBVIEW_VERSION_WITH_SAFE_AREA_FIX = 140;
+    // https://issues.chromium.org/issues/457682720
+    private static final int WEBVIEW_VERSION_WITH_SAFE_AREA_KEYBOARD_FIX = 144;
+
     static final String viewportMetaJSFunction = """
         function capacitorSystemBarsCheckMetaViewport() {
             const meta = document.querySelectorAll("meta[name=viewport]");
@@ -94,7 +98,7 @@ private void initSystemBars() {
         }
 
         initWindowInsetsListener();
-        initSafeAreaInsets();
+        initSafeAreaCSSVariables();
 
         getBridge().executeOnMainThread(() -> {
             setStyle(style, "");
@@ -157,7 +161,7 @@ private Insets calcSafeAreaInsets(WindowInsetsCompat insets) {
         return Insets.of(safeArea.left, safeArea.top, safeArea.right, safeArea.bottom);
     }
 
-    private void initSafeAreaInsets() {
+    private void initSafeAreaCSSVariables() {
         if (Build.VERSION.SDK_INT >= Build.VERSION_CODES.VANILLA_ICE_CREAM && insetHandlingEnabled) {
             View v = (View) this.getBridge().getWebView().getParent();
             WindowInsetsCompat insets = ViewCompat.getRootWindowInsets(v);
@@ -169,41 +173,57 @@ private void initSafeAreaInsets() {
     }
 
     private void initWindowInsetsListener() {
-        if (Build.VERSION.SDK_INT >= Build.VERSION_CODES.VANILLA_ICE_CREAM && insetHandlingEnabled) {
-            ViewCompat.setOnApplyWindowInsetsListener((View) getBridge().getWebView().getParent(), (v, insets) -> {
-                boolean hasBrokenWebViewVersion = getWebViewMajorVersion() <= 139;
+        ViewCompat.setOnApplyWindowInsetsListener((View) getBridge().getWebView().getParent(), (v, insets) -> {
+            boolean shouldPassthroughInsets = getWebViewMajorVersion() >= WEBVIEW_VERSION_WITH_SAFE_AREA_FIX && hasViewportCover;
+
+            Insets systemBarsInsets = insets.getInsets(WindowInsetsCompat.Type.systemBars() | WindowInsetsCompat.Type.displayCutout());
+            Insets imeInsets = insets.getInsets(WindowInsetsCompat.Type.ime());
+            boolean keyboardVisible = insets.isVisible(WindowInsetsCompat.Type.ime());
 
-                if (hasViewportCover) {
+            if (shouldPassthroughInsets) {
+                // We need to correct for a possible shown IME
+                v.setPadding(0, 0, 0, keyboardVisible ? imeInsets.bottom : 0);
+
+                if (Build.VERSION.SDK_INT >= Build.VERSION_CODES.VANILLA_ICE_CREAM && hasViewportCover && insetHandlingEnabled) {
                     Insets safeAreaInsets = calcSafeAreaInsets(insets);
                     injectSafeAreaCSS(safeAreaInsets.top, safeAreaInsets.right, safeAreaInsets.bottom, safeAreaInsets.left);
                 }
 
-                if (hasBrokenWebViewVersion) {
-                    if (hasViewportCover && v.hasWindowFocus() && v.isShown()) {
-                        boolean keyboardVisible = insets.isVisible(WindowInsetsCompat.Type.ime());
-                        if (keyboardVisible) {
-                            Insets imeInsets = insets.getInsets(WindowInsetsCompat.Type.ime());
-                            setViewMargins(v, Insets.of(0, 0, 0, imeInsets.bottom));
-                        } else {
-                            setViewMargins(v, Insets.NONE);
-                        }
-
-                        return WindowInsetsCompat.CONSUMED;
-                    }
-                }
+                return new WindowInsetsCompat.Builder(insets)
+                    .setInsets(
+                        WindowInsetsCompat.Type.systemBars() | WindowInsetsCompat.Type.displayCutout(),
+                        Insets.of(
+                            systemBarsInsets.left,
+                            systemBarsInsets.top,
+                            systemBarsInsets.right,
+                            getBottomInset(systemBarsInsets, keyboardVisible)
+                        )
+                    )
+                    .build();
+            }
 
-                return insets;
-            });
-        }
-    }
+            // We need to correct for a possible shown IME
+            v.setPadding(
+                systemBarsInsets.left,
+                systemBarsInsets.top,
+                systemBarsInsets.right,
+                keyboardVisible ? imeInsets.bottom : systemBarsInsets.bottom
+            );
+
+            // Returning `WindowInsetsCompat.CONSUMED` breaks recalculation of safe area insets
+            // So we have to explicitly set insets to `0`
+            // See: https://issues.chromium.org/issues/461332423
+            WindowInsetsCompat newInsets = new WindowInsetsCompat.Builder(insets)
+                .setInsets(WindowInsetsCompat.Type.systemBars() | WindowInsetsCompat.Type.displayCutout(), Insets.of(0, 0, 0, 0))
+                .build();
+
+            if (Build.VERSION.SDK_INT >= Build.VERSION_CODES.VANILLA_ICE_CREAM && hasViewportCover && insetHandlingEnabled) {
+                Insets safeAreaInsets = calcSafeAreaInsets(newInsets);
+                injectSafeAreaCSS(safeAreaInsets.top, safeAreaInsets.right, safeAreaInsets.bottom, safeAreaInsets.left);
+            }
 
-    private void setViewMargins(View v, Insets insets) {
-        ViewGroup.MarginLayoutParams mlp = (ViewGroup.MarginLayoutParams) v.getLayoutParams();
-        mlp.leftMargin = insets.left;
-        mlp.bottomMargin = insets.bottom;
-        mlp.rightMargin = insets.right;
-        mlp.topMargin = insets.top;
-        v.setLayoutParams(mlp);
+            return newInsets;
+        });
     }
 
     private void injectSafeAreaCSS(int top, int right, int bottom, int left) {
@@ -305,4 +325,18 @@ private Integer getWebViewMajorVersion() {
 
         return 0;
     }
+
+    private int getBottomInset(Insets systemBarsInsets, boolean keyboardVisible) {
+        if (getWebViewMajorVersion() < WEBVIEW_VERSION_WITH_SAFE_AREA_KEYBOARD_FIX) {
+            // This is a workaround for webview versions that have a bug
+            // that causes the bottom inset to be incorrect if the IME is visible
+            // See: https://issues.chromium.org/issues/457682720
+
+            if (keyboardVisible) {
+                return 0;
+            }
+        }
+
+        return systemBarsInsets.bottom;
+    }
 }
diff --git a/cli/src/declarations.ts b/cli/src/declarations.ts
index 6612eec777..5eacf5e654 100644
--- a/cli/src/declarations.ts
+++ b/cli/src/declarations.ts
@@ -713,7 +713,7 @@ export interface PluginsConfig {
      *
      * `css` = Injects CSS variables (`--safe-area-inset-*`) containing correct safe area inset values into the webview.
      *
-     * `disable` = Disable all inset handling.
+     * `disable` = Disable CSS variables injection.
      *
      * @default "css"
      */
diff --git a/core/system-bars.md b/core/system-bars.md
index c7654063bc..67275077af 100644
--- a/core/system-bars.md
+++ b/core/system-bars.md
@@ -73,7 +73,7 @@ const setStatusBarAnimation = async () => {
 ## Configuration
 | Prop          | Type                 | Description                                                               | Default            |
 | ------------- | -------------------- | ------------------------------------------------------------------------- | ------------------ |
-| **`insetsHandling`** | <code>string</code> | Specifies how to handle problematic insets on Android.  This option is only supported on Android.<br>`css` = Injects CSS variables (`--safe-area-inset-*`) containing correct safe area inset values into the webview.<br>`disable` = Disable all inset handling. | <code>css</code> |
+| **`insetsHandling`** | <code>string</code> | Specifies how to handle problematic insets on Android.  This option is only supported on Android.<br>`css` = Injects CSS variables (`--safe-area-inset-*`) containing correct safe area inset values into the webview.<br>`disable` = Disable CSS variables injection. | <code>css</code> |
 | **`style`** | <code>string</code> | The style of the text and icons of the system bars. | <code>DEFAULT</code> |
 | **`hidden`** | <code>boolean</code> | Hide the system bars on start. | <code>false</code> |
 | **`animation`** | <code>string</code> | The type of status bar animation used when showing or hiding.  This option is only supported on iOS. | <code>FADE</code> |