Unlike the traditional manner of having two persons as a member, one person company only has 1 member. Therefore the said person will be the sole shareholder and director. One person company has become the modified form of sole proprietorship. One person company cannot have paid up capital of more than 50 lakh rupees or turnover of more than 2 crore rupees. In case of contravention of this rule OPC will have to be converted into either a private limited company or a public company. It is a very good option for small businesses or start-ups.
Documents Required for OPC Registration
- Copy of PAN Card of owner.
Since there is only 1 Director and a member, a nominee on behalf of such person has to be appointed because in case he becomes insolvent or dies and cannot perform his duties, the nominee will perform on behalf of the director and take his place. His consent in Form INC – 3 will be taken along with his PAN card and Aadhar Card.
- Passport size photograph of the owner.
- Copy of Aadhaar Card/ Voter identity card.
- Copy of Rent agreement (If rented property)
- Electricity/ Water bill (Business Place)
- Copy of Property papers (If owned property)
- Landlord NOC (Format will be provided)
Proof of the Registered office of the proposed Company along with the proof of ownership and a NOC from the owner.
- Declaration and Consent of the proposed Director of Form INC -9 and DIR – 2 resp.
- A declaration by the professional certifying that all compliances have been made.
OPC Registration Process
Step 1: Apply for DSC and DIN [ 3 working days]
We shall obtain DSC and DIN for directors and apply for the name approval of OPC.
Step 2: Name Approval Application [ 2 working days]
Details provided by you for OPC registration will be verified by our experts and application for name approval will be made. For Name availability under RUN Web service, there is no prior requirement to obtain DSC and DIN. It can be done with account login on MCA portal.
Step 3: Apply for certificate of incorporation of OPC [ 10 working days]
We will apply for and obtain a certificate of incorporation for OPC and then apply for TAN and PAN, and your OPC will be ready to go.
Benefits of OPC Registration
- Lesser compliance burden
The One person Company includes in the definition of “Private Limited Company” given under section 2(68) of The Companies Act, 2013. Thus, an OPC will be required to comply with provisions applicable to private companies. However, OPCs have been provided with a number of exemptions and therefore have lesser compliance related burden.
- Limited liability
An OPC gives the advantage of limited liability to entrepreneurs whereby the liability of the member will be limited to the unpaid subscription money. This benefit is not available in case of a sole proprietorship.
- Perpetual succession
Sole Proprietorships come to an end with the death of the proprietor. As an OPC company has a separate legal identity, it would pass on to the nominee director and, therefore, continue to exist.
A person can be member in how many OPCs?
A person can be a member of only one OPC.
Who cannot form a One Person Company?
A minor shall not be eligible becoming a member
a. Foreign citizen
b. Non Resident of India
c. Any person incapacitated by contract
What are the mandatory requirements of an OPC?
All such businesses must maintain books of accounts, comply with statutory audit requirements and submit income tax returns and annual filings with the ROC.
How much does it cost to run an OPC?
The cost of an OPC is only marginally lower than that of a private limited company. You’ll be shelling out around Rs. 12,000 to incorporate, then paying around Rs. 15,000 a year in compliance fees and an auditor to inspect your books.
Is there any tax advantage on forming an OPC?
There is no specific tax advantage to an OPC over any other form. The tax rate is flat 30%, other tax provisions like MAT & Dividend Distribution Tax applies as they apply to any other form of company.
With relaxed operating norms and less compliance OPC can function very smoothly but the registration process for the same may be a little cumbersome. To swiftly incorporate your OPC reach out to us. We are here to complete the process for you in no time.