{
  "url": "https://openlegislation.uk/pension-schemes-act-2026/section-123",
  "json_url": "https://openlegislation.uk/pension-schemes-act-2026/section-123.json",
  "legislation": "ukpga/2026/22",
  "legislation_title": "Pension Schemes Act 2026",
  "legislation_url": "https://openlegislation.uk/pension-schemes-act-2026",
  "path": "section/123",
  "kind": "section",
  "number": "123",
  "heading": "Pension protection levies",
  "text": "(1) The Pensions Act 2004 is amended as follows.\n(2) In section 113 (investment of funds), in subsection (2)(b), omit “174 or”.\n(3) For the italic heading before section 174 substitute “Pension protection levies”.\n(4) Omit section 174 (initial levy).\n(5) In section 175 (pension protection levies)—\n(a) for subsection (1) substitute—\n“(1) For each financial year, the Board—\n(a) may impose a risk-based pension protection levy in respect of a description of eligible scheme (or in respect of all eligible schemes), and\n(b) if it does so, may also impose a scheme-based pension protection levy in respect of the same or a different description of eligible scheme (or in respect of all eligible schemes).\nIn this Chapter “pension protection levy” means a levy imposed in accordance with this section.”;\n(b) in subsection (3), after paragraph (a) insert—\n“(aa) the risks associated with a description of scheme which the Board considers is not supported by a substantive employer covenant;”;\n(c) in subsection (5), in the words before paragraph (a), after “financial year” insert “for which it decides to impose the pension protection levies (or one of them)”;\n(d) omit subsection (7);\n(e) before subsection (8) insert—\n“(7A) For the purposes of subsection (3)(aa), a scheme is “not supported by a substantive employer covenant” if, based on the financial position of the employer, there is no realistic prospect of the employer being able to provide the trustees or managers with material financial support for the purpose of satisfying liabilities of the scheme.\nFor that purpose the employer’s “financial position” means its financial position ignoring—\n(a) any capital buffer (within the meaning of Part 3 of the Pension Schemes Act 2026), and\n(b) any financial support which it may obtain from another person but to which it is not entitled.”;\n(f) in subsection (8), omit the definition of “initial period”;\n(g) in subsection (10)—\n(i) in the words before paragraph (a), for “duty” substitute “power”;\n(ii) omit paragraph (b) and the “and” before it.\n(6) In section 176 (supplementary provisions about pension protection levies)—\n(a) in subsection (1)—\n(i) for paragraph (a) substitute—\n“(a) no pension protection levies were imposed in the previous financial year, or”;\n(ii) in paragraph (b), for “the pension protection levies” substitute “any pension protection levies”;\n(iii) omit paragraph (c) and the “or” before it;\n(b) for subsection (2) substitute—\n“(2) The Board must publish in the prescribed manner details of—\n(a) any decision to impose, or not to impose, the levies for a financial year in respect of a description of scheme;\n(b) any determination under section 175(5).”\n(7) In section 177 (amounts to be raised by the pension protection levies)—\n(a) at the beginning insert—\n“(A1) Subsections (1) to (5) apply where the Board decides to impose one or both of the pension protection levies for a financial year.”;\n(b) in each of subsections (1), (2) and (3), for “a financial year” substitute “the financial year”;\n(c) omit subsection (4);\n(d) for subsection (5) substitute—\n“(5) The Board must impose pension protection levies for the financial year in a form which it estimates will raise an amount which does not exceed the sum of—\n(a) the amount estimated under subsection (1) in respect of any pension protection levies imposed for the previous financial year, and\n(b) 25% of the levy ceiling for the previous financial year.”;\n(e) in subsection (8), for the words from “Regulations” to “(6),” substitute “An order under subsection (6)”;\n(f) in subsection (9), omit paragraph (b) and the “and” before it.\n(8) In section 178 (levy ceiling)—\n(a) in subsection (1), omit “for which levies are required to be imposed under section 175”;\n(b) omit subsection (2);\n(c) in subsection (3), in the words before paragraph (a), omit “after the first year for which levies are imposed under section 175”.\n(9) Omit section 180 (transitional provision now spent).\n(10) In section 181 (calculation, collection and recovery of levies), in subsection (1), omit paragraph (a) and the “and” after it.\n(11) In section 316 (parliamentary control of subordinate legislation), in subsection (2), omit paragraph (c).",
  "extent": "E+W+S",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "I",
      "label": "I1",
      "text": "S. 123 not in force at Royal Assent, see s. 133(11)(b)"
    },
    {
      "type": "I",
      "label": "I2",
      "text": "S. 123 in force at 29.6.2026 by S.I. 2026/669, reg. 2"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/ukpga/2026/22/section/123",
    "retrieved_at": "2026-10-29T08:41:23.531539+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}