One Person Company
Start your business as a One Person Company (OPC) easily with Filecrat. An OPC company only consists of one person who is a director and the sole shareholder.
One Person Company Registration
One Person Company promotes the entrepreneurship in an individual. It’s a company run by a single person who is also the shareholder and the director.
One-person company does away with the requirement of minimum two shareholders. It allows a single entrepreneur to get his business registered as a company and get limited liability protection.
Requirements
- 1 Shareholder
- Minimum 1 Director
- The director and shareholder can be same person
- Nominee
- Indian citizen and resident can incorporate OPC
- Unique name
Advantages & Benefits
- Tax Benefits: A One Person Company enjoys lower maximum tax rate compared to a sole proprietorship concern.
- Limited Liability: The directors’ personal property is always safe in a One Person Company, no matter the debts of the business.
- Annual General Meeting: There is no need for OPCs to hold an annual general meeting or board meeting.
- Board Meetings: If there is only one director, there is no need to hold board meetings.
- Cash Flow Statement: It is not mandatory for OPCs to prepare a cash flow statement.
- Less Compliance: As compared to private and public Limited company, it is less compliance, therefore suitable for small businesses.
OPC vs LLP vs Pvt Ltd – Top 10 Major Differences
|
Particulars |
Private Limited Company (PLC) |
One Person Company (OPC) |
Limited Liability Partnership (LLP) |
|
Constitution |
Private Limited Company is a separate legal entity registered under the Companies Act, 2013 |
One Person Company is a separate legal entity registered under the Companies Act, 2013. |
LLP is a separate legal entity registered under the LLP Act, 2008. |
|
Mainly Useful for |
Businesses having high turnover, entrepreneurs who need external sources of funding. |
Services oriented businesses that have low investment needs. |
Proprietors looking to limit their liability & have 100% control. |
|
Minimum Number of Members |
2 Members |
1 Member |
2 Members |
|
Compliance |
In case of Private Limited Company compliance is high as compared to OPC and LLP. |
In case of One Person Company compliance is Moderate as compared to PLC and LLP. |
In case of Limited Liability Partnership compliance is low as compared to OPC and PLC. |
|
Transferability |
Ownership can be transferred by way of share transfer |
Ownership can be transferred. |
Ownership can be transferred. |
|
Capital Raising |
The capital raising is very easy in case of Private Limited Company |
The Capital Raising is difficult in case of One Person Company. |
The Capital Raising is moderately easy as well in case of Limited Liability Partnership. |
|
Income Tax Rates |
Tax @ 22% + 4% Cess Subject to satisfying conditions u/s 115BAA(2) of the Income-tax Act 1961 |
Tax @ 22% + 4% Cess Subject to satisfying conditions u/s 115BAA(2) of the Income-tax Act 1961 |
Tax @ 30% + 4% Cess |
|
Dividend Distribution Tax |
No DDT is levied for dividend declared after 31st March 2020 |
No DDT is levied for dividend declared after 31st March 2020 |
DDT is not applicable |
|
Employee Stock Option Plan |
ESOP can be issued |
ESOP is not applicable |
ESOP is not applicable |
|
Cost of Registration |
Approx. 7,999/- |
Approx. 5,999/- |
Approx. 6,499/- |
What's included
- 1 Directors DIN+DSC Class -2
- Filing of E-forms with the Registrar of Companies (ROC)
- Company Name Search & Approval
- MOA + AOA
- Issue of Incorporation Certificate
- Company PAN Card
- Company TAN/TDS Number
- GST Certificate
Documents Required
- Copy of PAN Card of Director
- Passport size photos of Director
- Partners identity proof: Driver’s license, Passport or Aadhar card, residence card or election identity card issued by the Government
- Address Proof: Latest Bank statement/ Utility bill not older than two months
- Registered Office Proof: Electricity/ Water bill/ Telephone bill/ Latest bank statement as proof of Registered Office (Business Place), Copy of Sale Deed/Property Deed (If owned property)
FAQ's
A Minor, Foreign citizen, Indian Nonresident, a person incapacitate to contract are restricted from Forming a One Person Company
A minimum of one is required while starting a One Person Company, but you can have up to 15 Directors for your OPC.
Yes, it can be converted into Private Limited Company, according to the provisions of the Companies Act voluntarily and also if the One Person Company has exceeded the threshold limit. If the paid-up share capital of an OPC exceeds fifty lakh rupees or its average annual turnover of immediately preceding three consecutive financial years exceeds two crore rupees by filing necessary forms.
Yes. The ROC has to be informed in Form INC-5 within 60 days of exceeding threshold limit.
One Person Company can be started with any amount of capital.
Only a natural person who is an Indian citizen and resident in India shall be eligible to act as a member and nominee of an OPC
No, FDI is not allowed for One Person Company, if it does then it will lose its very nature of One Person Company.
Yes, you can purchase already establish OPC from another person.
Yes, though there is no business transaction during the year till end of financial year, annual filing must be done on time.
Once a Company is incorporated, it will be active and in-existence as long as the annual compliances are met with regularly
Yes, A company can change its registered office any time after following specified procedure. The changed address can be situated within the same state or in a different state from the state in which it was originally registered.
MOA shall clearly specify the name of that other person, who will become the member of the Company
Authorized capital of a Company is the amount of shares a company can issue to its shareholders. Companies have to pay the Government an authorized capital fee to issue shares in a Company.
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