What is One Person Company Registration?
One Person Company Registration (OPC) is a private entity in which there is only one person with minimal liability who can work both as director and manager. Companies Act 1956, where one or two members are required to build a private limited company as well as a public company.
One Person Company has been introduced in India under the Companies Act 2013.
Who are able to start a venture on their own by allowing them to create an economic entity of a single person. Basically, the concept of OPC is to eradicate the limitation of a sole proprietorship, the most popular form in India for small businesses. The owner’s responsibility is restricted to the capital invested in this type.
One Person Company (OPC) Registration Process
- First, a Director Identification Number (DIN) and a digital signature certificate will be given to the sole shareholder.
- Then need to apply for the name of the company
- They should get the consent of the nominee in the prescribed forms.
- The agreement and the final incorporation forms shall be submitted with the Memorandum and Articles as well as other documentation required.
- The final certificate of incorporation shall be given from the business registry. Now, under the name, he can start a business.
- open a current bank account and PAN Number on the name of one person company.
Documents Required for One Person Company Registration
- Passport Size Photo
- Pan Card of the Director
- Identity Proof – DL / Passport / Aadhar Card / Voter card
- Address Proof – Bank Statement / Mobile Bill / Telephone Bill / Electricity
- Registered office address Proof – Electricity Bill / Water Bill / Phone Bill / Gas Line Bill / Property Ownership Document
- No Objection Certificate (NOC) from the owner
4 Simple Steps – OPC Registration
- Obtain DSC & DIN
- Name Reservation
- Drafting of MOA & AOA
- Filing e- forms with ROC
- Incorporation certificate from ROC
Nomination in case of One Person Company
The OPC report shall state the identity of the other person who has given his permission to be appointed in the specified form and who becomes a member of the company in the case that the individual is impaired due to death or incapacity to work. Such other person’s written consent is also to be filed during the formation of OPC along with the incorporation documents.
The company’s report shall specify the name of the person who becomes a member of the company in the event of the subscriber’s death. The member has the authority to change the nominee’s name at any point by notifying them in the specified way.
The new candidate should also give his permission to his name so that it exists, and any alteration in the applicant would require modification in the organization document. He must be an Indian resident living in India and not a minor
A candidate can withdraw his nomination by giving the member and the OPC his consent. In that scenario, after receiving his written consent, the participant shall designate another person within 15 days of the notice of withdrawal and submit the organization the intimation of that nomination. The OPC is required to file a report of withdrawal and fresh appointments within 30 days of the withdrawal.
Advantages of One Person Company Registration
A Separate legal entity – one person company is a separate legal entity and has the capability of managing the responsibilities and the functions undertaken by the management.
Easy Funding – Private company is one person company that can invest funds through venture capital, financial institutions, angel investors, etc. They can invest funds thus graduating to a private limited company.
More opportunities, Limited liability – One person company has some extent value of shareholding, the individual can take more risk in business without effecting business or personal assets. It is good for new, young and innovative start-ups.
Minimum compliances – One person company is facing many issues and compliances when compared to other private companies, they need to give more focus on functional activities and the business competitors. like core areas.
Benefits of being a Small Scale Industries – Benefits to provide small scale industries like Lower rate of interest, easy funding from bank loan without depositing security to certain limit, manifold benefits under foreign trade policy. All these benefits for any business in the initial year.
The Only Owner – ⠀The entrepreneur of the company can able to take quick decisions, controlling and managing the business without following any process or methodologies as adopted in other companies. It makes the sense of growing business.
Credit rating – One Person company with a bad credit rating may even get the loan.
Benefits under Income Tax Law – Any remuneration paid to the director unlike property ownership will be allowed as a deductible as per income tax law. Many possible tax benefits are also required in accordance with the income tax act. We have analyzed the differences between OPC vs Sole Proprietorship read more to find out the difference.
Receive interest on any late Payment – One Person company benefits under the enterprise’s development act 2006, The new start-up one person company like micro, small or medium all these covered under this act. As per the act, if the buyer or receiver has received any late payment then he has a legal right to receive interest price which is three times on the bank rate.
Increased Trust and prestige – Any business entity that functions in the context of a company also gains increased confidence and respect.
What has OPC Registration Govt Cost?
OPC has nominal share capital in excess of Rs. 10,00,000 of Rs. 2000 and Rs. 200 per 10,000 nominal share capital after the first 10,00,000 to Rs. 50,00,000. OPC registration usually takes around 20-30 days and you will obtain an OPC incorporation certificate upon registration.
Minimum Requirements for One Person Company Registration?
- One shareholder
- Minimum 1 director (director and shareholder can be the same person)
- 1 nominee
- Shareholder/nominee to be Indian resident
- Minimum authorized share capitals. 1 lakh
- Digital signature certificate for director
- Director identification number for the director
Naming Guidelines for in One Person Company Registration?
- The name shall not be the same or too similar to the name of the existing company.
- Name shall not use any word that means that it is government-related without government approval
A plural version of any of the words that appear in an actual company’s name does not make a name unique
Name should not violate section 3 of the Emblems Act 1950.
If you are adding words like New, Modern, Shri, Sri, Shree, Om, Jai, Sai, The, etc. does not make a name unique.
You cannot use words like Rashtrapati, Republic, panchayat, municipal, minister, nation, governor except approval from the government.
Annual compliance for One Person Company?
- Form AOC-4 for financial statement
- MGT-7 for an annual return
- Meeting of board at least twice in a year
OPC Registration Process Duration
5 Business Days
The OPC director should request or apply for a DSC as the Digital Signature Certificate, which must be filed for company records. To do this, just a few scanned papers need to be submitted; after that our agents must file the application by filling it out and putting it online for submission.
7 Business Days
Once the DSC application has been completed, our agents must ask you to pick a name for your company and give us the relevant documents reviewed for the same reason. It will be used to manage the sent documents for the SPICe i.e. INC-32 and the MoA are otherwise remembered as the Association Memorandum, and the Association Articles are also recognized as the AoA. Eventually, the Certificate of Incorporation will be issued and accepted at the end of this process.
2 Business Days
A registered PAN or Permanent Account Number and TAN or Tax Account Number are mandatory for all businesses. Our representatives will submit the application online, but you will be required to courier yourself the hard copies of the appropriate and necessary documents. Within 21 business days will you be sent the printing, TAN, and PAN to your registered office address.
Frequently Asked Questions
1. How can I register a One Person Company?
One Person Company can be licensed as a Private Limited Company, where the Ministry of Corporate Affairs lays out all the rules and regulations.
2. How many Directors can we have in One Person Company?
You need at least one when you start a One Person Company, but you can have up to 15 directors for your OPC.
3. Who can be a nominee for a One Person Company?
Nominee may be anybody, such as your husband, wife, mother, father, brothers, sisters, etc., but they should have proper proof of identity, such as PAN card, Voter I d, Passport or Driving License, etc., to be named as Nominees for One Person Company.
4. How can I change a nominee for my company?
A Nominee can be changed by properly informing and submitting the necessary forms with the Company Registrar.
5. How can a One Person Company converts itself into a Private Limited Company?
One person company can convert to a private company if the paid-up capital exceeds Rs. 50 lakes or its average turnover for the relevant period exceeds Rs. 2crores.
6. Can a One Person Company converted into a Private Limited Company?
yes, It can be converted into a private limited company. when one person company has exceeded the maximum limit by filing necessary forms.
7. What happens in case of the death of a member of the company?
The nominee undertakes the affairs of the company and within 15 days of time. the company has to intimate the Registrar of Companies by filing Form INC-4.
8. How much capital do I invest to start a One Person Company?
The minimum capital requirement is Rs. 1,00,000/- but this amount differs from your investment