diff --git a/Backend/SHA.hs b/Backend/SHA.hs
index 7abbf8035a..95ce4a7701 100644
--- a/Backend/SHA.hs
+++ b/Backend/SHA.hs
@@ -97,16 +97,17 @@ keyValueE :: SHASize -> KeySource -> Annex (Maybe Key)
 keyValueE size source = keyValue size source >>= maybe (return Nothing) addE
 	where
 		addE k = return $ Just $ k
-			{ keyName = keyName k ++ extension
+			{ keyName = keyName k ++ selectExtension (keyFilename source)
 			, keyBackendName = shaNameE size
 			}
-		naiveextension = takeExtension $ keyFilename source
-		extension
-			-- long or newline containing extensions are 
-			-- probably not really an extension
-			| length naiveextension > 6 ||
-			  '\n' `elem` naiveextension = ""
-			| otherwise = naiveextension
+
+selectExtension :: FilePath -> String
+selectExtension = join "." . reverse . take 2 . takeWhile shortenough .
+	reverse . split "." . takeExtensions
+	where
+		shortenough e
+			| '\n' `elem` e = False -- newline in extension?!
+			| otherwise = length e <= 4 -- long enough for "jpeg"
 
 {- A key's checksum is checked during fsck. -}
 checkKeyChecksum :: SHASize -> Key -> FilePath -> Annex Bool
diff --git a/debian/changelog b/debian/changelog
index 1c44f59526..5eaf9d52eb 100644
--- a/debian/changelog
+++ b/debian/changelog
@@ -9,6 +9,8 @@ git-annex (3.20120630) UNRELEASED; urgency=low
     but avoids portability problems.
   * Use SHA library for files less than 50 kb in size, at which point it's
     faster than forking the more optimised external program.
+  * SHAnE backends are now smarter about composite extensions, such as
+    .tar.gz Closes: #680450
 
  -- Joey Hess <joeyh@debian.org>  Sun, 01 Jul 2012 15:04:37 -0400