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To incorporate one person Company a minimum of two persons (1 Director and 1 Nominee) are required over the age of 18 years with both being an Indian citizen and resident
The concept of One Person Company in India was introduced in the Companies Act, 2013 to support entrepreneurs who on their own are capable of starting a venture by allowing them to create a single person economic entity. One of the benefits of a One Person Company (OPC) is that there can be only one member in an OPC, whereas a minimum of two members are required for registration of Private Limited Company or a Limited Liability Partnership (LLP). Similar to a Company, a One Person Company has a separate legal entity from its promoter, offering limited liability protection to its sole shareholder, also having continuity of business and being easy to incorporate.
Though a One Person Company allows alone Entrepreneur to operate a corporate entity with limited liability protection, a OPC does have a few limitations. For example, every One Person Company (OPC) must nominate a nominee Director in the MOA and AOA of the company - who will become the owner of the OPC in case of sole Director is disabled. Also when it crosses its annual turnover of Rs. 2 crores has to get converted in to Private Limited Company and also required to file audited financial statement with MCA at the end of each financial year. Therefore, one must consider carefully the features of a One Person Company prior to incorporation.
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The minimum time taken to complete a One Person Company Registration is about 10 - 15 working days, subject to government processing time and client document submission. Get a free consultation for one person company registration and business setup in India by scheduling an appointment with a Docsplanner Advisor.
Companies Act, 2013 does not permit registration of identical or similar names for Company Incorporation.
OPC registration is possible with only one member, while private limited company minimum two members are required.
It is mandatory to appoint nominee in One Person Company but there is no such provision in private limited Company
Only person can be a director in OPC whereas at least two directors are required for incorporation of private limited company.
Foreign national as member is not permitted in case of OPC registration only indian resident is required. Activities such carrying as NBFC business, investment in securities cannot be done by OPC also fund raising activities in the form of equity investment from investors is not possible in case of OPC,
Therefore from the expansion and funding and investment and also from growth point of view Private Limited Company is better than OPC.
During the process of incorporation the sole director and shareholder must propose one person as his/her nominee. The sole promoter must obtain his consent. Therefore in case of death or incapacitation of shareholder or promoter in OPC the nominee would automatically become the sole promoter of the OPC.
Appointment of statutory auditors within 30 days of incorporation.
OPC need to hold only one Board Meeting in every half of financial year, further minimum time period must be 90 days between the two Board Meeting.
OPC should file financial statements in AOC-4 format within 180 days from the end of financial year.
Only a natural person who is an Indian citizen and resident of India shall be eligible to act as a member and nominee of an OPC.
A person who has stayed in India for a period of not less than 182 days or more during the immediately preceding calendar year.
A person can be a member only in one OPC
Where a natural person is member in One Person Company becomes a member in another OPC by virtue of his being a nominee in that OPC he/she shall vacate/change the membership to meet the criteria within a period of 180 days.
The Company shall inform any change in membership of OPC due to cessation of member due to death, incapacity to contract or change in ownership in e-form INC-4, details of new member need to be mentioned.
Yes, there is threshold limit for an OPC, where the paid up share capital of an OPC exceeds 50 lakh rupees or its average annual turnover immediately preceding three consecutive financial year exceeds 2 crores then OPC has to mandatorily get converted in to Private or Public Company.
An e-form INC-6 shall be filed for conversion of an OPC into Private or Public Company.
The time limit for filing an e-form INC-6 is within 30 days in case of voluntary conversion and within 6 months of mandatory conversion.
An e-form INC-5 need to be filed for informing about exceeding threshold limit to ROC.
An e-form INC-5 need to be filed within 60 days of exceeding threshold limit.
In case of withdrawal of consent by nominee of an OPC or in case of intimation of change in nominee by the member then an E-form INC-4 shall be filed.
Yes, as per the proviso to Section 12(3) of the Companies Act, 2013 it is necessary to add word “One Person Company” which shall be mentioned in bracket.
As per the Companies (Incorporation) Rules, 2014 no person shall be eligible to become a nominee in more than one OPC.
At the time of incorporation of an OPC sole member of OPC is required to appoint another person as his nominee and his name shall be mentioned in memorandum of association of OPC.
The nominee shall be appointed as members:
1. In the event of death of sole members/subscriber; or
2. In the event of sole members/subscriber himself becomes incapable to contract
Nominee is required to give his consent in INC-3 form while incorporating OPC
Please note here that only natural person who is an Indian Citizen and resident of India is eligible to be nominee
Yes, member can change nominee of OPC by giving him a notice.
1. A minor
2. Foreign Citizen
4. A person incapacitated to contract
5. A person other than natural human being
An OPC cannot enter in to following business activities :
1. Non-Banking Financial Investment
2. Finance Companies
NO, OPC cannot converted into Section 8 Company
OPC can have more than one Directors on the Board. As per the provisions of Section 149 a OPC can have maximum 15 directors. It can however may appoint more than 15 directors after passing Special Resolution.
Yes, the annual return shall be filed in case of OPC and shall be signed by the Company Secretary or where there is no Company Secretary it should be signed by Director.
No, holding Annual General Meeting is not mandatory in case of OPC.
The Financial Statements of an OPC is required to be signed by only one Director for submission to the auditor for his report thereon.
As per rule 4(3) and (4) of the Companies (Incorporation) Rules, 2014.
Nominee may withdraw his consent by giving written notice to the OPC member/subscriber and to OPC.
The sole member/subscriber to nominate a new person as his nominee within 15 days of the notice of withdrawal of consent of old nominee.
The sole member/subscriber should intimate to ROC of such nomination in writing and of the written consent of new nominee in e-form INC-3.
OPC shall within 30 days of the receipt of notice of withdrawal file e-form INC-4 the intimation of such withdrawal and nomination, And also e-form INC-3 for consent of the new nominee.
The subscriber or member can change the nomination for any reason by giving notice in writing to the OPC.
The member of OPC need to obtain prior consent in e-form INC-3.
OPC to file with ROC within 30 days of receipt of intimation of change.
OPC shall within a period of 60 days from the date when it ceases its entitlement to continue as OPC, shall intimate to ROC in e-form INC-5
1. That it has ceased to be OPC
2. That it is now required to convert itself into Private or Public Limited Company by virtue of its paid-up share capital or average annual turnover exceeding threshold limit.