The Personal Pension Schemes (Appropriate Schemes) Regulations 1997
S.I. 1997/470 · Made 25 February 1997 · Extends to England, Wales and Scotland
PENSIONS
Made 25th February 1997
Laid before Parliament 4th March 1997
Coming into force 6th April 1997
The Secretary of State for Social Security, in exercise of the powers conferred upon him by sections 7(1), (6) and (7), 9, 26, 34(1), (2) and (8), 43(1) and (3), 44(1) and (2), 45(3), 45B, 155, 181(1), 182(3) and (4), and 183(1) of the Pension Schemes Act 1993M1 and of all other powers enabling him in that behalf, after agreement with the Occupational Pensions Board that certain proposals embodied in these Regulations need not be referred to them, by this instrument, which otherwise contains regulations made for the purpose of consolidating regulations revoked hereinM2, hereby makes the following Regulations:
Annotations to the whole text
Marginal citations
- M1
1993 c.48 as amended by Part III of the Pensions Act 1995 (c.26). Section 181(1) is cited because of the meaning ascribed to “prescribed" and “regulations".
- M2
See section 185(1), (2) and (6) of the Pension Schemes Act 1993 (c.48) and section 173(1)(b) of the Administration Act 1992 (c.5), under which the requirement to consult does not apply where regulations are made only for the purpose of consolidating other regulations revoked by them or which are where the Occupational Pensions Board agrees that regulations need not be referred to them.
Modifications
- C1
Regulations: transfer of functions (1.4.1999) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), ss. 1(2), 28(3), Sch. 2; S.I. 1999/527, art. 2(b), Sch. 2
Contents
- 1Citation, commencement and interpretation
- 2Forms of schemes which may be appropriate schemes Repealed
- 3Persons who and bodies which may establish schemes Repealed
- 4Requirements in respect of an application for an appropriate scheme certificate Repealed
- 5Issue of appropriate scheme certificates Repealed
- 6Requirement to give the Secretary of State information Repealed
- 6AProvision of information for purposes of contracting-out Repealed
- 7Cancellation, variation and surrender of an appropriate scheme certificate Repealed
- 8Applications for the variation of, and to surrender, appropriate scheme certificates Repealed
- 9Cancellation of an appropriate scheme certificate Repealed
- 10Notice under section 44(1) of the 1993 Act Repealed
- 11Notice under section 44(2) of the 1993 Act Repealed
- 12Circumstances in which minimum contributions are not to be paid
- 13Manner of payment of minimum contributions
- 14Allocation of minimum contributions Repealed
- 15Calculation or estimation of earnings
- 16Calculation of minimum contributions
- 17Adjustment of amount of minimum contributions
- 18Cancellation of membership of interest-bearing account-funded appropriate personal pension schemes Repealed
- 19Transitional provision in respect of earnings
- 20Revocations
- Signature
- Schedule 1: KINDS OF UNIT TRUST SCHEME THAT MAY BE AN APPROPRIATE SCHEME Repealed
- Part I: KINDS OF UNIT TRUST SCHEME Repealed
- 1Paragraph 1 Repealed
- 2Paragraph 2 Repealed
- 3Paragraph 3 Repealed
- 4Paragraph 4 Repealed
- Part II: DEFINITIONS Repealed
- Paragraph Repealed
- Schedule 2: INFORMATION TO BE INCLUDED IN NOTICE Repealed
- 1Paragraph 1 Repealed
- 2Paragraph 2 Repealed
- 3Paragraph 3 Repealed
- 4Paragraph 4 Repealed
- 5Paragraph 5 Repealed
- 6Paragraph 6 Repealed
- 7Paragraph 7 Repealed
- 8Paragraph 8 Repealed
- 9Paragraph 9 Repealed
- Schedule 3REVOCATIONS
- Explanatory note
1Citation, commencement and interpretation
These Regulations may be cited as the Personal Pension Schemes (Appropriate Schemes) Regulations 1997 and shall come into force on 6th April 1997.
In these Regulations—
“the 1993 Act" means the Pension Schemes Act 1993;
F1...
...
F2...
F3...
“overseas scheme" means an occupational pension scheme which is administered wholly or primarily outside the United Kingdom but does not include one which is contracted-out within the meaning of section 7(3) of the 1993 Act nor one to which section 53 M1 of the 1993 Act applies;
“pensionable age" has the meaning given by the rules in paragraph 1 of Part I of Schedule 4 to the Pensions Act 1995; and
...
“tax week" has the same meaning as in section 181(1) of the 1993 Act.
...
In these Regulations, unless the context otherwise requires, any reference—
to a numbered regulation is to the regulation in these Regulations bearing that number;
in a regulation to a numbered paragraph is to the paragraph of that regulation bearing that number; and
in a paragraph to a lettered sub-paragraph is to the sub-paragraph of that paragraph bearing that letter.
2Forms of schemes which may be appropriate schemesF1
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3Persons who and bodies which may establish schemesF1
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4Requirements in respect of an application for an appropriate scheme certificateF1
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5Issue of appropriate scheme certificatesF1
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6Requirement to give the Secretary of State informationF1
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6AProvision of information for purposes of contracting-outF1
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7Cancellation, variation and surrender of an appropriate scheme certificateF1
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8Applications for the variation of, and to surrender, appropriate scheme certificatesF1
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9Cancellation of an appropriate scheme certificateF1
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10Notice under section 44(1) of the 1993 ActF1
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11Notice under section 44(2) of the 1993 ActF1
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12Circumstances in which minimum contributions are not to be paid
Minimum contributions shall not be paid in respect of an earner for the tax year or any part of the tax year in which that earner—
reaches pensionable age; or
dies and in which he would have reached pensionable age.
Subject to paragraph (2), where the earner is no longer a member of the earner’s chosen scheme, minimum contributions in respect of that earner shall be paid—
to the trustees or managers of the earner’s chosen scheme, if the earner has become a member of another scheme, and the earner’s chosen scheme is able to transfer the payment to that other scheme,
to the trustees or managers of another scheme of which the earner is a member, if known to HMRC , or
in all other circumstances, to the earner.
Where effect has been given to the earner’s protected rights under section 28 of the 1993 Act M1 (ways of giving effect to protected rights), F2as it had effect prior to the abolition date minimum contributions shall not, except as provided by paragraphs (3) to (9) be paid in respect of the period during which the scheme was the earner’s chosen scheme.
Where effect has been given to the earner’s protected rights by the making of a transfer payment to another appropriate scheme which has become the earner’s chosen scheme or a money purchase contracted-out scheme, the minimum contributions shall be paid to the trustees or managers of that scheme F3, except where the earner is no longer a member of that scheme, in which case the minimum contributions shall instead be paid to the earner.
Where effect has been given to the earner’s protected rights by the making of a transfer payment to a salary-related scheme or an overseas scheme and the Secretary of State becomes aware, as a consequence of evidence in respect of the earner’s age being brought to his attention, that an additional amount of minimum contributions would have been payable had he been aware of that evidence, that additional amount of minimum contributions shall be paid to the trustees or managers of that scheme F4, except where the earner is no longer a member of that scheme, in which case the additional amount of minimum contributions shall instead be paid to the earner.
Where effect has been given to the earner’s protected rights by the purchase of an annuity or by the provision by the scheme of a pension, and the amount of the minimum contributions in question is at least 10 times as great as the lower earnings limit for the tax year in which the Secretary of State becomes aware that minimum contributions are payable or would be payable, but for paragraph (2), those minimum contributions shall be paid (in the case of an annuity) to the insurance company from which the annuity has been purchased or (in the case of a pension) to the trustees or managers of the scheme.
Where effect has been given to the earner’s protected rights by the purchase of an annuity or by the provision by the scheme of a pension and—
the circumstances in paragraph (5) do not exist; and
minimum contributions are payable for the tax year or part of the tax year in which the earner died,
those minimum contributions shall be paid to the earner’s F5widow, widower or surviving civil partner, or if the earner died unmarried, F6and was not a civil partner at the time of his or her death they may at the Secretary of State’s discretion be paid to any person.
Where effect has been given to the earner’s protected rights by the purchase of an annuity or by provision by the scheme of a pension and—
the circumstances in paragraph (5) do not exist; and
the Secretary of State becomes aware, as a consequence of evidence in respect of the earner’s age being brought to his attention, that an additional amount of mimimum contributions would have been payable had he been aware of that evidence,
that additional amount of minimum contributions shall be payable for any tax year before or part of a tax year before effect has been given to protected rights to the earner or the earner’s widow, widower or surviving civil partner, or if the earner died unmarried, and was not a civil partner at the time of his or her death they may at the Secretary of State’s discretion be paid to any person.
Where effect has been given to the earner’s protected rights by the provision of a lump sum, minimum contributions shall be payable to the earner or the earner’s widow, widower or surviving civil partner, or if the earner died unmarried, and was not a civil partner at the time of his or her death they may at the Secretary of State’s discretion be paid to any person.
Where effect has been given to the earner’s protected rights by the making of payments under an interim arrangement, minimum contributions shall continue to be payable to the trustees or managers of the earner’s chosen scheme.
13Manner of payment of minimum contributions
Minimum contributions shall be paid—
by automated credit transfer into a bank or building society account which relates to the relevant scheme and which accepts payments made by automated credit transfer; or
in such other manner as the Secretary of State may in his discretion approve.
14Allocation of minimum contributionsF1
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15Calculation or estimation of earnings
In relation to any tax year, the earnings of an earner shall be calculated or estimated, for the purposes of section 45(1) of the 1993 Act, on the basis mentioned in this regulation.
In paragraph (3)—
“eligible tax week" means any tax week in any part of which the earner in question is at least 16 years of age and in no part of which he is over pensionable age; and
“ineligible tax week" means any tax week which is not an eligible tax week.
In relation to any eligible tax week in a tax year the earnings of an earner shall be taken to be the amount calculated or estimated in accordance with paragraph (4) divided by the number of eligible tax weeks in that tax year, and in relation to any ineligible tax week they shall be taken to be nil.
The formula to be applied shall be the formula set out in paragraph (5)(a) or, if it produces a smaller value for X, the formula set out in paragraph (5)(b), so however, that if the formula set out in paragraph (5)(a) produces a negative value for X, or if the value of P is nil, the value of X shall be taken to be nil.
The formulae mentioned in paragraph (4) are—
; and
In paragraph (7)—
“primary Class 1 contributions" does not include contributions which the earner, being a married woman or widow, is liable to make at a reduced rate in accordance with an election which she has made and which is still operative; and
the reference to contributions as having been paid includes the case of contributions which are treated as having been paid under regulation 39 of the Social Security (Contributions) Regulations 1979 M1 but does not include the case of contributions which are treated as not paid under regulation 38(1) and (2)(a) of those Regulations.
In this regulation—
L is the lower earnings limit for the tax year in question;
P is the total earnings, in so far as the earnings for each week did not exceed U, paid to or for the benefit of the earner in relation to the tax year in question, in relation to which primary Class 1 contributions have been paid with respect to employments that are not contracted-out;
R is the total earnings, in so far as the earnings for each week did not exceed U, paid to or for the benefit of the earner in relation to the tax year in question, in relation to which primary Class 1 contributions have been paid with respect to employments that are contracted-out;
S is the total earnings, in so far as the earnings for each week equalled or exceeded L but did not exceed U, paid to or for the benefit of the earner in relation to the tax year in question, in relation to which primary Class 1 contributions have been paid with respect to employments that are contracted-out; and
U is the upper F1accrual point for the tax year in question.
16Calculation of minimum contributions
For the purposes of determining the appropriate age related percentage for the purposes of section 45(1) of the 1993 Act M1, the Secretary of State may require an earner to send documentary evidence of his date of birth.
For the purposes of section 45B(2) of the 1993 Act M2 (information held as to the age to be disclosed by the Secretary of State to trustees or managers of an appropriate personal pension scheme and such other persons as may be prescribed) the prescribed person shall be the person who is responsible for administering the scheme.
17Adjustment of amount of minimum contributions
Where the amount of minimum contributions payable in respect of an earner in relation to a tax year would otherwise not be a whole number of pence, it shall be adjusted to the nearest whole number of pence, and any amount of half penny or less shall be disregarded.
18Cancellation of membership of interest-bearing account-funded appropriate personal pension schemesF1
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19Transitional provision in respect of earnings
For the purposes of paying minimum contributions in respect of an employed earner for any period up to and including the tax year 1996—1997, regulations 16 and 17 of the Personal Pension Schemes (Appropriate Schemes) Regulations 1988 M1 shall continue to have effect as if regulation 15 of these Regulations had not come into force.
20Revocations
The regulations listed in column 1 of Schedule 3 to these Regulations are revoked to the extent specified in column 3 of that Schedule.
Signature
Signed by authority of the Secretary of State for Social Security
Oliver Heald
Parliamentary Under-Secretary of State,
Department of Social Security.
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Schedule 3REVOCATIONS
| Regulations Revoked | References | Extent of Revocation |
|---|---|---|
| The Personal Pension Schemes (Appropriate Schemes) Regulations 1988 | 1988/137 | The whole of the Regulations. |
| The Personal Pension Schemes (Miscellaneous Amendments) Regulations 1988 | 1988/830 | Regulation 3. |
| The Personal and Occupational Pension Schemes (Miscellaneous Amendments) Regulations 1989 | 1989/500 | Regulation 4. |
| The Personal and Occupational Pension Schemes (Miscellaneous Amendments) Regulations 1990 | 1990/1141 | Regulation 8. |
| The Occupational and Personal Pension Schemes (Miscellaneous Amendments) Regulations 1993 | 1993/519 | Regulation 5. |
| The Occupational and Personal Pension Schemes (Consequential Amendments) Regulations 1994 | 1994/1062 | Regulation 2 and Schedule 2 paragraph 21 in so far as it relates to the Personal Pension Schemes (Appropriate Schemes) Regulations 1988. |
| The Occupational and Personal Pensions (Miscellaneous Amendments) Regulations 1995 | 1995/35 | Regulation 7. |
| The Personal Pension Schemes (Appropriate Schemes) Amendment Regulations 1995 | 1995/1612 | Regulation 2. |
| The Personal Pension Schemes (Appropriate Schemes and Disclosure of Information) (Miscellaneous Amendments) Regulations 1996 | 1996/1435 | Regulation 2. |
| The Personal and Occupational Occupational Pension Schemes (Miscellaneous Amendments) Regulations 1996 | 1996/776 | Regulation 6. |
Explanatory note
(This note is not part of the Regulations)
The Personal Pension Schemes (Appropriate Schemes) Regulations 1997 (“the Regulations") consolidate the Personal Pension Schemes (Appropriate Schemes) Regulations 1988 with amendments and in addition make minor and drafting amendments. The Regulations also make provisions which are consequential upon Part III of the Pensions Act 1995 (c.26) coming into force.
The Regulations prescribe the form of schemes which may be appropriate schemes (regulation 2 and Schedule 1); persons and bodies which may establish appropriate schemes (regulation 3); the requirements in respect of an application and issue of an appropriate scheme certificate (regulations 4 and 5); the requirement to give the Secretary of State information as requested in respect of the application for cancellation or variation or the surrender of an appropriate scheme certificate (regulations 6, 7, 8 and 9); the requirements in respect of notices under section 44 of the Pension Schemes Act 1993 (regulations 10 and 11); circumstances in which minimum contributions are not to be paid, manner of payment and allocation of minimum contributions (regulations 12, 13 and 14); calculation and estimation of earnings (regulation 15); calculation and adjustment of minimum contributions (regulations 16 and 17); cancellation of membership of interest-bearing account-funded appropriate personal pension schemes (regulation 18 and Schedule 2).
Regulations 19 and 20 and Schedule 3 provide for savings and revocations.
An assessment of the compliance cost of measures arising from the Pensions Act 1995, including regulations, has been placed in the libraries of both Houses of Parliament. Copies can be obtained from the Department of Social Security, 11th Floor, Adelphi, 1—11 John Adam Street, London WC2N 6HT.