One Person Company or OPC registration is a concept of forming a legal entity with only one person as the sole owner of the Business. It is the process of corporatization of a single individual. Only a natural person who is a citizen of India, whether resident in India or otherwise, can become the sole member of One Person Company. The sole member himself can act as director of the Company as well. Running of OPC requires a minimum of one Director and a maximum of 15 directors without any additional compliance.
Further, the sole member of the OPC needs to appoint his nominee at the time of registration of the company and at all the times thereafter, who shall, in the event of the member’s death or his incapacity to contract, become the member of that One Person Company. Like the member, the nominee should also be a natural person who is a citizen of India, whether resident in India or otherwise.
One Person Company has a separate legal entity distinct from its members and Directors. OPC is more suited to freelancers or individuals who desire to have complete control of their business without the participation of any second person. One Person Company registration protects small entrepreneurs from the disadvantages of sole proprietorship and secures them with the status of a company. (Update via MCA notification dated 01st February 2021_even NRIs can now incorporate one person Company and act as its member or nominee)
A One Person Company is registered under the Companies Act with an entity distinct from its owner and Directors, i.e. Separate Legal Entity.
A One Person Company can be incorporated with a single person who may act as a director and a shareholder at the same time. However, a nomination is additionally required.
Compliances for Meetings & E-returns filling as per the Companies Act 2013 are less in number as compared to that for a Private Limited Company.
An OPC registration is one of the easiest forms of registering a business. Under a one person company, it is easier to raise funds and loans because the status of a company is better than a sole proprietorship.
Two names for the proposed OPC, in the order of preference, are applied online through SPICE+ Part A.
Documentation and Certification for DSC (Digital Signature Certificate) is applied with the relevant authorities.
An online application for the registration of an OPC is filed in SPICE+ Part B, together with SPICE+ MOA, SPICE+ AOA, Agile Pro, and INC-9.
Basis the application, as the application gets approved, COI, PAN, TAN, EPF and ESIC Registration number get allotted in the name of the Company.
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No, OPC can have only one member.
Yes, OPC can have more than one director.
A One Person company may be converted into a Private or Public Company, other than a company registered under section 8 of the Act, after increasing the minimum number of members and directors to two or seven members and two or three directors, as the case may be and by making due compliance as prescribed in the Law for such conversion.
1. OPC cannot be converted into Section 8 Company.
2. Any business which carries out Non-Banking Financial Investment activities including investment in securities of anybody corporates.
A person can become a member in only one OPC at a time.
Two Board Meetings with a gap of at least 90 days between each meeting is required to be held by OPC.
Yes, a member of a One Person Company can be a nominee of only one other OPC at the same time. Further, where such a member of the One Person Company becomes a member in another such Company by virtue of his being a nominee in that One Person Company, such person shall meet the eligibility criteria within a period of one hundred and eighty days and accordingly surrender the membership in either of the two companies..
In India, under the Companies Act, 2013 there is no specific tax advantage for a OPC company. The one-person company registration is liable to pay tax at a flat rate of 22%. Any additional taxes like MAT and DDT are applicable just like other companies.
As per the Ministry of Corporate Affairs, only a natural person who is an Indian citizen, whether resident of India or not, is allowed to register as a member or nominee of the One Person Company.
For one person company registration, there are certain mandatory legal compliances that should be followed. They are:
1. Maintenance of proper books of accounts.
2. Complying to the statutory audit requirements.
3. Annual timely submission and filing of Income tax returns before 30th September.
4. Filing of Financial Statements in Form AOC-4 and ROC Annual Return in form MGT 7.
The persons not eligible to form an OPC are:
1. A minor cannot become a member.
2.A Foreign national.
3.Any person disabled to contract.
No, foreign direct investment is not allowed in a one person company.
Yes, Once an OPC is registered, we assist the company in compliance with Tax and Legal compliances on a monthly subscription basis. you can find the details on our website under the plans tab.