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(1) These Regulations may be cited as the Pension Schemes (Voluntary Contributions Requirements and Voluntary and Compulsory Membership) Regulations 1987 and shall come into force—
(a) for the purposes of personal pension schemes on 4th January 1988; and
(b) for the purposes of occupational pension schemes on 6th April 1988.
(2) In these Regulations, except where the context otherwise requires—
 “the Act” means the Social Security Act 1986;
 “normal pension age” and “public service pension scheme” shall be construed in accordance with section 66(1) of the Social Security Pensions Act 1975;
 “pensionable service” and “relevant employment” shall be construed in accordance with Schedule 16 to the Social Security Act 1973;
 “scheme” means a personal or occupational pension scheme;
 “secondary Class 1 contribution” shall be construed in accordance with section 4 of the Social Security Act 1975;
 and other expressions have the same meaning as in the Act.
(3) In these Regulations, except where the context otherwise requires, any reference to a numbered section is to the section of the Act bearing that number.
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(1) Section 12(1) (voluntary contributions requirements) shall not apply to the rules of any public service pension scheme unless it is an exempt approved scheme for the purposes of section 21 of the Finance Act 1970.
(2) Section 12(1) shall not apply to the rules of any personal pension scheme in so far as it is comprised in an annuity contract made before 4th January 1988.
(3) Section 12(1)(a) and (b) shall not apply to the rules of any scheme in so far as they relate to the payment by a member of any sum as voluntary contributions where that payment would not qualify for relief from tax in accordance with section 21(4) or 22(2) of the Finance Act 1970.
(4) Section 12(1)(a) and (b) shall not apply to the rules of any scheme in so far as they provide that a member of the scheme must give the trustees or managers of the scheme notice, of a period not exceeding 12 months, of his intention to pay voluntary contributions at a specified rate or to vary that rate.
(5) Section 12(1)(a) and (b) shall not apply to the rules of any personal pension scheme in so far as they relate to a member whose rights under the scheme derive only from one or more transfer payments.
(6) Section 12(1)(a) and (b) shall not apply to the rules of any occupational pension scheme (“the first scheme”) in so far as they relate to a member—
(a) in respect of whose current pensionable service the scheme will provide benefit only on his death; or
(b) whose pensionable service either has not begun or has terminated; or
(c) who is either within one year of reaching, or has reached, normal pension age; or
(d) who is, or is eligible to become, a member of at least one other occupational pension scheme which applies to the same employment as the first scheme and which—
(i) if he is a member of it, complies in relation to him, or, if he is not a member of it, would comply in relation to him if he were, with the voluntary contributions requirements, and
(ii) is not a scheme which, if he is a member of it, falls in relation to him, or, if he is not a member of it, would fall in relation to him if he were, to be regarded as a scheme excepted from the application of section 12(1)(a) and (b) by virtue of paragraph (1), (2), (5) or (6)(a), (b) or (c) of this regulation.
(7) Section 12(1)(b) shall not apply to the rules of any scheme in so far as they impose, or allow any person to impose, a lower limit on the payment by a member of voluntary contributions in respect of any tax year if that lower limit is not higher than the amount specified in paragraph (8) of this regulation.
(8) The amount last mentioned in paragraph (7) of this regulation is 0.5 per cent. of the member’s earnings in that tax year, or, if it is greater, 3 times the lower earnings limit (within the meaning of section 1 of the Social Security Pensions Act 1975 for that tax year.
(9) In paragraph (8) of this regulation, “member’s earnings” means—
(a) in the case of a member of a personal pension scheme, his earnings attributable to his employment as an employed earner; or
(b) in the case of a member of an occupational pension scheme, his earnings attributable to his relevant employment,
in respect of which secondary Class 1 contributions are payable.
(10) Section 12(1)(b) shall not apply to the rules of any scheme in so far as they impose, or allow any person to impose, an upper limit on the payment by a member of voluntary contributions which is equivalent to the maximum amount which, ignoring any remuneration in kind, could be paid in any period without prejudicing the qualification of the scheme for tax-exemption or tax-approval.
(11) Section 12(1)(c) and (d) shall not apply to the rules of any scheme in relation to a member’s voluntary contributions to the extent that those contributions are paid under an agreement—
(a) which was made before the date on which section 12 came into force; and
(b) which has not, since that date, been varied.
(12) Section 12(1)(d)(ii) shall not apply to the rules of any scheme to the extent that the additional benefits provided in accordance with them are money purchase benefits.
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Section 15(1)(a) (terms of contracts of service or schemes restricting choice to be void) shall not apply to any term of a contract of service or any rule of an occupational pension scheme to the effect that an employed earner must be a member of a particular occupational pension scheme or one or other of a number of particular occupational pension schemes, during any period when that scheme is, or those schemes are, so framed that in relation to that period—
(a) the earner in question is not required to pay contributions to the scheme, and
(b) the scheme will provide benefit in respect of that earner only on his death.
Signed by authority of the Secretary of State for Social Services.
Nicholas Scott
Minister of State,
Department of Health and Social Security
25th June 1987