OPC Company Definition
A One Person Company (OPC ) registration service is a type of company registration service that allows entrepreneurs to establish a company with only one shareholder. In India, OPCs are a popular business form because they provide the benefits of limited accountability while allowing entrepreneurs to keep entire control over their businesses. With the passage of the Company’s Act in 2013, a novel idea known as the “One Person Company” was established in India. A single person in India can form a “One Person Company.” A single person could not form a business prior to the implementation of the Companies Act of 2013. An OPC combines the advantages of a sole proprietorship with those of a company. In the past, a person should only choose a single proprietorship if they needed to start a firm.
A business can be incorporated under Section 2 (62) of the Company’s Act 2013 with just 1 director and 1 member. There are fewer compliance requirements for one-person companies registered in India than for private limited companies.
According to the Companies Act of 2013, a one-person company can register in India with just one director and one member. The same person may serve as both the Director and a member. Here, a person can register an OPC in India whether they are a resident or non-resident Indian.
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Benefits of OPC Legal standing
The member grants the OPC independent legal entity status. The sole person who incorporated the OPC is protected by its distinct legal status. The member’s liability is restricted to the value of his or her shares; he or she is not personally responsible for the company’s loss. Therefore, the OPC and not the member or director may be sued by the creditors.
- Easy access to funding: OPC can easily raise money through venture capital, angel investors, incubators, and other sources because it is a private firm. Banks and other financial institutions prefer to lend money to corporations over sole proprietorship businesses. This makes getting money simple.
- Fewer conformities: The Companies Act of 2013 grants the OPC some exemptions in relation to compliances. The cash flow statement does not have to be made by the OPC. The annual reports and books of accounts can only be signed by the director; the company secretary is not required to sign them.
- Simple integration: OPC can be incorporated quickly because all that is needed is one member and one nominee. The director may also be a member. There is no minimum paid-up capital requirement, but the minimum allowed capital for incorporating OPC is Rs. As a result, incorporation is simple in comparison to other business structures.
- Simple to control: The OPC can be founded and maintained by a single person, making administration simple. Making decisions is simple, and decision-making happens quickly. By entering the ordinary and special resolutions in the minute book and having only one member sign them, the member can simply pass them. As a result, managing the business will be simple because there won’t be any internal conflicts or delays.
- Continuous succession: Even with just one member, the OPC has the feature of everlasting succession. The single member must designate a nominee while incorporating the OPC. When a member passes away, the nominee will take over the management of the business.
ELIGIBILITY FOR REGISTRATION OF A ONE-PERSON COMPANY
- There can be only one one-person business per person.
- A minor is not eligible to join or be a nominee.
- An OPC company is not permitted to engage in non-banking financial investment activities, such as purchasing corporate securities.
- An OPC must convert into a private or public limited company within six months if its paid-up capital reaches more than Rs 50 lakh or its average annual revenue over the previous three years exceeds Rs 2 crore.
OPC Company registration documents
The following documents must be submitted in order to register a one-person business:
- Passport or PAN card
- In the case of NRIs and foreign nationals, a passport
- Driver’s license and voter ID in scanned form
- Most recent gas or energy bill, bank statement, mobile phone bill, or landline bill
- A sample signature
- Photos the size of a passport
- The paperwork needs to be self-attested. The paperwork for NRIs needs to be apostille- or notarized-signed.
- Additional Paperwork Needed by Registered Office:
- Scanned copies of your gas or energy bill, your bank statement, and your mobile or landline bill
- Scanned copy of the lease contract
- If the member is the property’s owner, a scanned copy of the No-objection Certificate (NOC) from them will be followed by a scanned copy of the sale deed.
OPC Company registration process
The applicant must do the following actions in order to register a one-person business:
Step 1: Obtaining DSC: The applicant must get a Digital Signature Certificate (DSC) from the Certifying Authority in order to register.
Step 2: Obtain a DIN: The suggested Director’s Director Identification Number (DIN) is used. Along with the Director’s information, the DIN is applied in the SPICe Form.
Step 3- Name Approval: XYZ (OPC) Private Limited will be the formal name of the company.
One name for the OPC can be applied for using SPICe, and RUN service will be utilized to check the availability of names (INC 32).
Step 4- One-Man Company Incorporation: Form Spice must be filed for the incorporation of OPC within twenty days of the day that RUN, or permission of name, was granted. All necessary paperwork must be included with the SPICe form and uploaded to the MCA portal. At incorporation, the PAN and TAN will be generated automatically.
Step 5- Obtaining an incorporation certificate: If the information and supporting documentation are suitable, the Registrar of Companies will issue a COI, or Certificate of Incorporation.
Limitations for One-Person Companies
No person under the age of 18 may join the One Person Company or serve as a nominee. A beneficial interest in a share cannot be held by a minor. Before the passage of two years from the date of OPC’s incorporation, OPC is not permitted to undergo a voluntary conversion. Under the provisions of Section 8 of the Act, it cannot be formed or changed into a company. Non-banking financial investment activities are not something it can do.
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