ONE PERSON COMPANY
@ Rs 5999 All Inclusive No Hidden Charge
*Stamp Duty Extra For Madhya Pradesh, Punjab & Kerala
One person company is a single person owned private limited company. OPC require one person as shareholder and minimum one person as a director to run the operations.
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WHAT IS ONE PERSON COMPANY?
In Companies Act, 2013 a new concept was introduced that is ONE PERSON COMPANY which means a single person can run his business in a proper legal entity form. One Person Company is a legal entity which is registered with the Ministry of Corporate Affairs (MCA). It is a kind of private limited company but with single person ownership. There is no profit or dividend sharing concept. It is bone for a single person who wants to run his business in the form of a registered entity. One person company shall have only one member, but there can be a maximum of 15 directors. One Person Company has features of both sole proprietorship as well as private limited, the member of the company has ownership like a sole proprietor, but the liabilities are limited as the members have in the private limited company. It has all the features like a private limited entity with few exceptions provided under Companies Act, 2013. It is a hybrid version of the sole proprietorship firm and private limited company.
What Do You Get In One Person Company Registration
Documents Required For One Person Company Registration
Process Of One Person Company Registration
- Submit Documents
- Name Approval
- Digital Signature
- Documents Preparation
- Company Incorporation
You need to submit all the required documents.
We will verify all the documents and then apply for the name approval through the RUN application form. In one form we can apply for 4 names. Name of the company is subject to Government approval.
After the name approval of the company, we will apply for the Digital Signature. For Digital Signature Video and Mobile Verification will be required.
After Name approval and Digital signature, we will draft Memorandum of Association, Article of Association and subscription statement of your company and will submit it to the Registrar of Companies with prescribed e-form Spice 32. We will apply for PAN and TAN application simultaneously.
Once all the documents submitted are duly verified by Registrar of Companies, the approval is given and the Certificate of Incorporation is sent to you on your email id.
More About One Person Company
Under Companies Act, 2013 and rules made thereunder there are specific provision prescribed which are required for the registration of One Person Company:
MEMBER: As per Companies Act, 2013 only a natural and individual person can be a member of a One Person Company. An OPC cannot add more than one shareholder in the company during its tenure, but if it does so then first, it needs to convert itself from OPC to either the private limited company or public limited company.
DIRECTOR: In Companies Act, 2013 there is a limit prescribed for the appointment of a director in the company, and every company needs to follow such rules for the appointment of a director. In One Person Company, the companies act say that there must be at least one director in the company but which goes maximum to the 15, but this limit can be exceeded only with prior approval of the member of the company. An only individual person shall be the director of the company
NOMINEE: In each OPC the member needs to appoint his nominee. After the death of the member the nominee may either himself become the member of the OPC or can renounce his right to become a member to any other person. A member shall nominate only one individual and natural person as his nominee. The member can change his nominee any time during the tenure of his membership.
NAME: The name of the company is essential and initial part to start the business. An OPC must contain the business activity with the name of the company and “(OPC) PVT LTD / OPC Private Limited” at the end of the name of the company. As per new rule, a person can apply two names at a time for name approval, and CRC either allow anyone names among two given names or re-submit the name application form. If the form is re-submitted the applicant get another one chance for filing name application in which he can again apply for two different names and that names also either can be approved or get rejected by the CRC. The government denies the name application if it found that the applied name is similar to any registered company/LLP name or with any registered trademark/logo. Once the application gets rejected, the applicant needs to file a fresh application for the name approval along with prescribed fees again.
REGISTERED OFFICE: It is a place where a company can run its business and operate all the activities and conduct all the meetings as per mentioned in the companies act, 2013. At the time of registering the company, the promoter needs to submit all the relevant documents for the registered office address to the registrar of the company. If the company doesn't have any permanent office address, then the promoter has to arrange a place which shall be the registered office address of the company and the same shall be intimated to the registrar. It is an essential part of the company as the registrar shall send all the relevant documents and notices if any at the registered office address and the same office address should be mentioned in all the documents and letterheads of the company.
CAPITAL: Under Companies Act, 1956 there was no concept of OPC, so there were no rules regarding capital limits. However, in new Companies Act, 2013 a new idea of business introduced which is now known as One Person Company (OPC) without any capital limit which means in this act the minimum requirement of capital is no more required, and an OPC can start its business with any lesser amount. However, there is a maximum capital limit for the OPC which means if an OPC reached that limit then it shall have to mandatorily convert itself from OPC to either Private Limited Company or Public Limited Company. Moreover, the maximum limit is Rs. Fifty lakhs of paid-up share capital.
It is a new concept introduced by the government to give the opportunity to the single person to register his business with the ministry. Before this concept, there was no such provision. The advantages for OPC registration are:
- The main advantage is that a single person can register his business with Registrar of Companies as a private limited company with the word (OPC).
- There is no ownership and profit sharing between the members as there is only one person as a member of the company
- The better decision taking ability as there is only one member and director, so there is no contradiction in making any decision
- It has all the features like a private limited company such as limited liability which means member and director are different from the company. Member and director will not be personally liable for any debt or losses incurred by the company
- Less compliance burden as compared to a private limited company and public limited company
- OPC may conduct at least one board meeting in each half of the calendar year, and the gap between two board meeting shall not be more than 90 day
- No need to maintain the quorum limit in the board meeting if the board of the company contains only one director (the minimum threshold of the director in the company is one)
- If there is one director in the company then no need to maintain the minute book because there is no need to take consent from any other person for the approval of any resolution
- No need to conduct the annual general meeting or extraordinary general meeting of the company as there is only one member of the company
- As the company had the identity of a private limited company and registered with the ministry which helps in getting the financial help from the banks and financial institutions as it gives the reliability for their status
- As compared to the other companies the tax complications are less, and the saving is more in an OPC. As there are only sole director and the single member, so there is no profit distribution, the member can invest his profit and expand his business.
There are certain disadvantages of One Person Company along with advantages and these are:
- It is the best option for small enterprises but only for a single person. A group of person cannot run his business under the OPC concept.
- It cannot issue shares to any person as the membership lies only with a single member. It can take debts for raising funds but cannot issue shares.
- If the limit of paid-up share capital gets increased by 50 lakh rupees and turnover by two crores rupees in any financial year then OPC need to mandatorily convert itself from OPC to either the private limited company or public limited company as per its relevancy
- Under Income Tax Act, 1961 it does not have any separate provision for OPC, so it is treated as a private limited company under IT act, 1961. Hence, OPC falls under the slab rate of 30% under IT act, 1961 like a private limited company, which is a massive tax rate for a small scale business.
- A single person cannot incorporate its company without appointing a nominee. The same person can be the member as well as the director in the OPC, but he/she needs to nominate any other natural person as his nominee who will become the member of the OPC after his death.
- Due to single ownership, an OPC cannot operate its business in the banking or financial sector it cannot run the Non-banking financial activities
- OPC cannot convert itself into a section-8 company as section-8 Company can be either a private limited company or a public limited company.
- Annual filing is mandatory even though it doesn't need to hold an annual general meeting
- OPC cannot issue ESOPs or ESOs or Sweat Equity Shares to its employees as there are restrictions for issuing shares.
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One Person Company Registration @5999/-
Frequently Asked Questions
Ques: Which kind of business can be operated under OPC?
An OPC can operate any business, but it should not be an illegal activity or any prohibited activity under any law or against the general public. However, an OPC also cannot operate any NBFC activities or any finance and investment-related activities. An OPC also cannot incorporate as a section-8 company.
Ques: Can an OPC raise fund? If yes, then in which way?
Yes, but not in the form of shares. An OPC can raise fund for the company through debt like taking loans from the bank or any financial institutions or by issuing debentures or deposits. But OPC cannot issue debenture which is fully or partial convertible debenture.
Ques: As like a private limited company is it necessary to hold any meeting?
Generally no, because as OPC has only one member and director, so it is not possible for one person to conduct the meeting. However, as per Companies Act, 2013 at least one board meeting shall be held in each half of the calendar year.
Ques: Who can be the nominee in the OPC?
Only the individual person is eligible to be the nominee in the OPC except minor. A nominee should be an Indian Citizen and resident of India.
Ques: Is there any limit on the appointment of employees in the OPC?
No, the OPC can appoint end number of employees as there is no limit on the appointment of the employees for the company. The company can appoint the employees as per its requirement.
Ques: Can an OPC issue shares?
Yes, but only to its shareholder. An OPC cannot issue share to anyone except its member, but the maximum limit of the paid-up share capital of the company is Rs. 50 Lakhs. An OPC cannot issue shares to its member more Rs. 50 Lakhs during its life, if OPC does so then firstly, it has to convert itself from OPC to either the private limited company or a public limited company.
Ques: Is it necessary that nominee shall become the member in the OPC after the death of the member?
Yes, after the death of the member the nominee becomes the member of the OPC, but if he doesn’t want to be the member of the company he can transfer his right. However, if he becomes a member of OPC, then he has to nominate his nominee within 15 days of becoming a member of OPC.
Ques: How many directors can be appointed in the OPC?
As per section 149 and section 165 of Companies Act, 2013 minimum one director is required in the OPC and the maximum 15 directors can be on the board of OPC.