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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 Pension Schemes Act 1993;
 “normal pension age” and  “public service pension scheme” shall be construed in accordance with section 181(1) of the Act;
 “pensionable service” and  “relevant employment” shall be construed in accordance with section 70 of the Act;
 “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 111(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 111(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 1st July 1988.
(3) Section 111(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 111(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 111(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 111(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 111(1)(a) and (b) by virtue of paragraph (1), (2), (5) or (6)(a), (b) or (c) of this regulation.
(6A) Section 111(1)(a) and (b) shall not apply to the rules of any scheme which provides that the only contributions payable in respect of a member shall be the minimum contributions payable by the Secretary of State in respect of that member under section 43 of the Act if—
(a) the scheme is an appropriate scheme...; and
(b) the member to whom the limitation applies is concurrently a member of an occupational pension scheme; and
(c) the scheme is currently the member’s chosen scheme under section 44 of the Act; and
(d) the member has entered into a written agreement with the trustees or managers of the scheme that this regulation shall apply in his case.
(7) Section 111(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 111(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 111(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 of the Social Security Act 1986 (from which section 111 of the Act is derived) came into force; and
(b) which has not, since that date, been varied.
(12) Section 111(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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For the purposes of section 111 of the Act (which exempts scheme rules from the need to comply with that section to the extent necessary to qualify for tax-exemption or tax-approval) “tax-exemption” and “tax-approval” mean respectively exemption from tax and approval of the Inland Revenue under either Chapter I or Chapter 
IV
 of Part XIV of the Income and Corporation Taxes Act 1988.

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Section 160(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
