OPC (One Person Company) Registration

WHAT IS A ONE PERSON COMPANY?

OPC (One Person Company) Registration is a new form of business introduced by Companies Act, 2013. It is hybrid form of business where a sole proprietorship concern can get a corporate outlook.

OPC (One Person Company) Registration is a hybrid structure, wherein it combines most of the benefits of a sole proprietorship and a company form of business. It has only one person as a member who will act in the capacity of a director as well as a shareholder. Thus, it does away with the hassles of finding the right kind of co-partner/s for starting a business as registered entity. The best part is, legal and financial liability is limited to the Company and not the member.

One Person Company Registration

CHARACTERISTICS OF PARTNERSHIP FIRM

Only One Shareholder

Only a natural person who is an Indian citizen and resident in India shall be eligible to incorporate a One Person Company.

Easy Funding

like a private company, One person company can raise a fund through venture capital, financial institute, angel investors, etc. An OPC can raise funds thus graduating itself to a private limited company.

Minimum Directors

Must have a minimum one director, the Sole Shareholder can also be the Sole director. The company must be have 15 director maximum.

Complete Control Of The Company With The Single Owner

This leads to being fast decision making and execution. yet he/she can appoint as many as 15 directors in the OPC for administrative functions, without giving any shares to them.

Paid- Up Capital

A one-person company can be started with 1 lac. If the company capital increases to 50 lac or more OPC will become automatically.

Suitable Only For Small Business

OPC is suitable only for small business. OPC can have the maximum capital of 50lac and turnover of 2cr. Otherwises OPC need to be turn into private limited company.

ADVANTAGES OF ONE PERSON COMPANY

Single Shareholder

A single shareholder who can also be the sole director can start an OPC.

Separate Legal Identity

OPC gets the status of a separate legal entity.

Limited Liability

The sole shareholder gets to enjoy the limited liability feature of a company.

No minimum capital required

No minimum capital is required to start an OPC.

One Person Company Registration

DISADVANTAGES OF ONE PERSON COMPANY

Suitable only for small businesses

OPC is suitable only for small businesses, OPC can have maximum Paid up share capital of Rs.50Lakhs or Turnover of Rs.2 Crores. Otherwise OPC need to be converted into Private Ltd Company.

Cannot convert into Sec8 Company

One Person Company cannot be incorporated or converted into a company under Section 8 of the Act.

Cannot run NBFC business

One Person Company cannot carry out Non – Banking Financial Investment activities including investment in securities of anybody corporate.

PROCESS FOR INCORPORATION OF ONE PERSON COMPANY

Applying DIN & DSC

DSC and DIN for all directors are required. Affidavit and declaration by first subscribers and Directors should be prepared.

Name Approval

4-6 proposed names should be provided that should be unique and suggestive of company business.

Application to ROC

Sign and file various documents including Memorandum of Association (MOA) & American Osteopathic Association (AOA) with the Registrar of Companies electronically.

MOA, AOA & AFFIDAVIT

Memorandum and Articles of Assocication should be drafted.

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