One Person Company Registration
One person company (OPC) can be easily registered through Compliance Solution. OPC is the best way to start your own company. An OPC is the most preferred form of business in India especially for small scale industry in terms of funding. An OPC is introduced for the first time in the Companies Act, 2013 (India).
In earlier time if a single person has to start a company he has only one option, to work as a proprietor. The proprietorship form of a firm has some advantages that you don’t require to register the company, less compliance and also you can work as an individual.
So we can understand OPC as the concept between proprietorship and private limited company. In OPC the company is registered and you get the flexibilities of proprietorship and all the benefits of a private limited company. Here, only one person is the shareholder of the company and i.e. the owner itself.
Private Limited Company Features + Proprietorship Features = One Person Company
Here, we’ll mention all the details for One Person Company Registration. Read carefully each and every point because every customer is our responsibility and we are trying to give every single information to you. Let’s start with the advantages of OPC in India.
1.No Minimum Capital: There is no minimum paid-up capital requirement for OPC registration. However, the maximum authorized capital of a one-person company should not exceed Rs 50 lakhs at any time. If it exceeds, it is required to convert the OPC to Pvt. Ltd. Co.
2.Limited Liability of shareholder: The liability on the shareholder is limited. The personal asset of the shareholder won’t be taken into consideration to the debt of the business. The property is safe, only liabilities related to business will be in consideration.
3. Less Compliance: The compliances under OPC registration are very less as compared to any other company. Minimum paperwork is done. AGM is not compulsory.
4. Continuous Existence: The death or illness or incapacity of the director won’t disturb the ongoing process of the company as the nominee director will hold the rope to continue the business.
5. Greater Credibility: As an OPC needs to have its books audited annually, it has greater credibility among the vendors and the lending institution.
6. Min. hurdles to start: You can start an OPC easily. You don’t need the second director/shareholder to start with. As a sole entrepreneur, you can start a company whenever you wish.
Various documents required for One Person Company registration:
ID card: Driving license/ Voter ID/ Passport/ Aadhaar card
Address Proof: Telephone bill/ Electricity bill/ Water bill
Copy of rental agreement
Now put some light on key features of OPC:
You are the single shareholder of the company but you have to name a Nominee.
The nominee will become the owner in case of death or any other disability of the shareholder of the company. In that case, the nominee has the right to continue the company or shut it down. So there is no perpetual succession.
Who can make the OPC?
Any natural person who is the resident of India only can register for OPC. Also, the nominee should only be an Indian citizen. No person can make more than 1 OPC or be the nominee of more than 1 OPC.
Some common benefits those are similar to Private Limited Company.
• Min authorized capital is 1 Lakh but there is no limitation on minimum
paid up capital.
• Drafting of MOA & AOA.
• Private Limited is attached to company name e.g. [Co Name] Pvt. Ltd.
• DIN (Directors Identification Number) is a unique 8 digit number that is required for any existing or proposed Director of a Company.
• Reservation of the name of the company.
• You will get the PAN, TAN of the company.
How many directors can be made in OPC?
The minimum number of the director is 1 & maximum directors can go to 15 for OPC but if you want to increase no. of directors then you can pass a board resolution.
Can OPC be converted into Private Limited Company?
OPC can be converted in Pvt. Ltd. Co. after 2 years of incorporation. And if you want to convert it early then you can exceed its max paid-up capital i.e. 50 lakhs.
If the average turnover of the last 3 financial years exceeds Rs 2 crores then you have to convert it into Pvt. Ltd. Co.
Who should start OPC?
Many people who are small traders and shop owners who manage their business alone will definitely form OPC. They can take loans against their business and their personal liabilities will be safe in case of debt.
Many professionals who work alone like Chartered Accountants, Lawyers, Architects, Engineers, Interior Designers, Media consultants etc can register OPC.
Youtubers & Bloggers who work alone can opt for OPC.
Single Entrepreneur can start with OPC and later convert it into Pvt. Ltd. Company.