diff --git a/mssql/base.py b/mssql/base.py
index c69046ac..9c4d5299 100644
--- a/mssql/base.py
+++ b/mssql/base.py
@@ -88,7 +88,8 @@ def handle_datetimeoffset(dto_value):
     # Decode bytes returned from SQL Server
     # source: https://github.com/mkleehammer/pyodbc/wiki/Using-an-Output-Converter-function
     tup = struct.unpack("<6hI2h", dto_value)  # e.g., (2017, 3, 16, 10, 35, 18, 500000000)
-    return datetime.datetime(tup[0], tup[1], tup[2], tup[3], tup[4], tup[5], tup[6] // 1000)
+    return datetime.datetime(tup[0], tup[1], tup[2], tup[3], tup[4], tup[5], tup[6] // 1000,
+                             datetime.timezone(datetime.timedelta(hours=tup[7], minutes=tup[8])))
 
 
 class DatabaseWrapper(BaseDatabaseWrapper):
diff --git a/mssql/functions.py b/mssql/functions.py
index 861c6ae4..0cc75c87 100644
--- a/mssql/functions.py
+++ b/mssql/functions.py
@@ -153,9 +153,11 @@ def sqlserver_exists(self, compiler, connection, template=None, **extra_context)
     return sql, params
 
 def sqlserver_now(self, compiler, connection, **extra_context):
-        return self.as_sql(
-            compiler, connection, template="SYSDATETIME()", **extra_context
-        )
+    if settings.USE_TZ:
+        return self.as_sql(compiler, connection, template="SYSDATETIMEOFFSET()", **extra_context)
+    else:
+        # continue using SYSDATETIME to get the DB local time when django is not TZ aware
+        return self.as_sql(compiler, connection, template="SYSDATETIME()", **extra_context)
 
 def sqlserver_lookup(self, compiler, connection):
     # MSSQL doesn't allow EXISTS() to be compared to another expression