One Person Company (OPC)

One Person Company (OPC) Registration

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One Person Company (OPC)

The concept of One Person Company in India was introduced through the Companies Act, 2013 to support entrepreneurs who on their own can start a venture by allowing them to create a single person entity. One of the biggest advantages of a One Person Company (OPC) is that there can be only one member in an OPC, while a minimum of two members are required for incorporating and maintaining a Private Limited Company or a Limited Liability Partnership (LLP). Like a Private Limited Company, a One Person Company is a separate legal entity from its promoter, offering limited liability protection to its sole shareholder, while having continuity of business and being easy to incorporate.

One Person Company must be converted into a Private Limited Company if it crosses an annual turnover of Rs.2 crores and must file audited financial statements with the Ministry of Corporate Affairs at the end of each Financial Year like all other types of Companies. Therefore, it is essential for the Entrepreneur to carefully consider the features of a One Person Company before incorporation.

Benefits of One Person Company

With the introduction of One Person Company, the limited liability and continuous existence feature is now also available for One Person Company, which is an entity with just one member. As One Person Company has just one member, it is necessitated by the law for the single member of the Company to designate another person in the Memorandum of Association, who on the event of subscriber’s death or incapacity shall become the person to contract. This mechanism provides an adequate safeguard to ensure continuous existence of the entity even in case of incapacitation of the single member.

OPC in India is required to prepare and file financial statements that includes balance sheet, profit and loss account, statement of changes in equity and explanatory notes.

 OPC Registration Requirements

  • The minimum authorised capital is Rs 1,00,000.
  • A nominee must be appointed by the promoter during incorporation.
  • Businesses involved in financial activities cannot be incorporated as an OPC.
  • OPC must be converted to a private limited company when paid-up share capital exceeds Rs.50 lakhs or turnover crosses Rs.2 crores.
  • A person can incorporate not more than one OPC and an OPC is prohibited from having a minor as its member.

Incorporation Process

The process for incorporation of a One Person Company can be divided into four steps as under:

Obtaining Name Approval, Incorporation Filing and Commencement of Business

We offer company registration services like one-person company registration, private limited company registration, Nidhi Company Registration, Section 8 Company Registration, Producer Company Registration and setting up permanent establishment for foreign companies. The average time taken to complete a one-person company registration is approximately 15 working days, subject to client document and necessary government approvals. If you are interested in forming an OPC, we at there for you.

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