One Person Company (OPC) is a popular form of business structure in India that was introduced in 2013 under the Companies Act. It is a type of company that can be formed with just one director and one shareholder. OPC is an ideal option for small business owners who want to establish a separate legal entity without any partner.
Meaning and Definition:
One Person Company (OPC) is a company registered under the Companies Act, 2013, with only one person as a member. The concept of OPC was introduced to encourage small entrepreneurs to start their businesses without any partner.
Legal Provisions and Rules:
The Companies Act, 2013 provides the legal provisions for the registration and management of OPC. The following are the rules and regulations that must be followed while registering and managing an OPC:
- Only a natural person who is an Indian citizen and resident in India can incorporate an OPC.
- An OPC can have only one director and one shareholder.
- The minimum authorized capital required for an OPC is Rs. 1 lakh.
- The name of the company should end with “OPC Private Limited”.
- An OPC must file annual returns and audited financial statements with the Registrar of Companies (ROC).
- An OPC cannot convert itself into a public company or a private company with more than one member.
- The director of an OPC must nominate a nominee in case of his/her death or incapacity.
Types of One Person Company:
There are two types of OPC in India:
Limited by shares: In this type of OPC, the liability of the member is limited to the amount of capital contributed by him/her.
Limited by guarantee: In this type of OPC, the member’s liability is limited to the amount he/she has guaranteed to pay in case of winding up of the company.
Advantages of One Person Company Registration:
Limited liability protection: The liability of the member is limited to the amount of capital contributed by him/her, and hence the personal assets of the member are safe.
Separate legal entity: An OPC is considered as a separate legal entity from its member, which means it can sue or be sued in its own name.
Easy to manage: An OPC can be managed by just one person, which makes it easy to manage and operate.
Credibility: An OPC has better credibility in the market compared to a sole proprietorship firm.
Disadvantages of One Person Company Registration:
High compliance cost: An OPC has to comply with various statutory and regulatory requirements, which increases the compliance cost.
Limited expansion: An OPC cannot convert itself into a public or private company with more than one member, which limits its expansion.
Documents Required for One Person Company Registration:
- PAN card of the director and shareholder
- Aadhaar card of the director and shareholder
- Passport size photograph of the director and shareholder
- Address proof of the director and shareholder
- Digital signature certificate of the director
- No objection certificate from the owner of the registered office
- Memorandum of Association (MOA) and Articles of Association (AOA) of the company
- Board resolution for appointment of the director and nominee director
- Consent letter from the director and nominee director
One Person Company registration in Bihar India is a great way for small business owners to establish a separate legal entity without any partner. The registration process is simple and requires minimal documentation. However, an OPC has to comply with various statutory and regulatory requirements, which increases the compliance cost.
One Person Company registration in Bihar is a new idea that has been presented with the Company’s Act 2013. One Person Company in Bihar is started by a sole individual. Before the enactment of the Companies Act 2013 a single individual couldn’t start a company. An OPC has elements of a Company and the advantages of the sole proprietorship firm. Prior in the event that an individual needed to lay out a business, the person ought to just settle on a sole ownership firm. But now he or she can start a private limited company without any other person.
As per by Section 2 (62) of the Company’s Act 2013, an One Person Company can be opened with only 1 director and 1 shareholder. One Person Company registration in Bihar is a sort of substance where there are lesser compliances necessities than that of a Private Limited Company.
It is fitting that Proprietorship Firms should get themselves exchanged over totally to One Person Company (OPC), for different Strategic Benefits, as referred to underneath. It is acknowledged that One Person Company (OPC) will go very far in straightening out the unstructured market of proprietorship firms.a
One Person Company (OPC) can be outlined as:
OPC Company Limited by Share Capital
OPC Company Limited by Guarantee
OPC Unlimited Company
One Person Company is a cross variety of Sole-Proprietor and Company kind of business, and has been given concessional/relaxed requirements under the Act.
A One Person Company can be coordinated as a private confined association figuratively speaking.
It can have quite recently a solitary part whenever of time
It could have quite recently a solitary boss.
The words “One Person Company” ought to be referred to in segments under the name of the association.
Exemption is open from holding Board Meetings (assuming there ought to be an event of only one boss) and General Meetings.
Necessities for One Person Company Registration in Bihar:
∙ One individual association can have recently a solitary investor.
∙ The part should be of Indian identity and occupant of India.
∙ Simply an individual can transform into a section, no other firm/LLP/association.
Individual Shareholder (Member)
Because of death/deficiency to contract, it is normal that owner of OPC picks an up-and-comer. Simply a solitary individual can transform into a particularly favored one that will also transform into the owner of the OPC (should be an Indian occupant).
The proprietor ought to assign something like one Director. OPC can have many bosses. Proposed Director(s) ought to have a Director Identification Number (DIN) gave by the Ministry of Corporate Affairs (MCA).
The name of an OPC includes 3 segments:
Article or Activity
Private Limited (OPC)
The proposed name will end with words ‘Private Limited (OPC)’. ‘Proposed Company name is to be embraced by the Registrar of Companies.
Registered Office Address
A fleeting area is normal at the hour of enlistment of the Company. This temporary area could be of any of the Directors.
After enrollment, the organization needs to record the durable work environment with chronicles of confirmation of address, ownership, etc.
Objects of the OPC insinuate the proposed business works out. These Objects give the course to the association.
OPC things should be authentic and shouldn’t hurt the overall population. The name of OPC will in like manner hint the essential, fundamental things. In case the name of the OPC isn’t portraying a particular thing, then the OPC can have complex articles.
Digital Signature Certificate (DSC)
All records are reported online with Registrar of Companies. Computerized Signature Certificate (DSC) should be checked by the authenticity of the file. Subsequently, all of the files should be affirmed by using a Digital Signature Certificate of the Director.
Organizations of specialists like Chartered Account (CA), Company Secretary (CS), Cost Accountant is supposed to make fundamental Certifications and proclamations for union of a One Person Company (OPC).
Why to Register One Person Company?
∙ Confined Liability Protection to Directors individual assets: Many times new organizations need to gain cash and expect things on affirmation. Assuming there ought to emerge an event of possession firms, Proprietor’s own save assets and property would be in peril in case business can’t repay its credits.
∙ Better picture and legitimacy in Market: In India, OPC is a Private limited association, which is a renowned and remarkable business structure. Corporate Customers, Vendors and Govt. Associations like to oversee Private Limited Company as opposed to possession firms.
∙ Limitless oversight of the Company with a Single Owner: This prompts fast route and execution. Anyway OPC can choose as much as 15 bosses for legitimate limits, without giving any proposal to them.
∙ Easy to Sell OPC: OPC Company is easy to sell, incredibly less documentation and cost is related with selling a One Person association.
∙ Contender for the Shareholder: The Shareholder will assign another person who will transform into the financial backers assuming that there ought to be an event of death/insufficiency of the principal financial backer. Such applicant will give his/her consent and such consent for being named as the Nominee for the sole Shareholder.
∙ Boss: Must have no less than One Director, the Sole Shareholder could himself anytime be the Sole Director. The Company could have a biggest number of 15 bosses.
Restrictions of OPC:
∙ A singular won’t be able to coordinate more than a One Person Company or become competitor in more than one such association.
∙ Minor can’t will turn out to be part or picked one of the One Person Company or can hold share with beneficial interest.
∙ An OPC can’t be united or changed over into an association under Section 8 of the Act. [Company not actually for Profit].
∙ An OPC can’t do Non-Banking Financial Investment practices recalling theory for insurances of anybody corporate.
∙ An OPC can’t change over purposely into any kind of association with the exception of assuming that two years have passed from the date of joining of One Person Company.
Steps to Incorporate One Person Company (OPC):
∙ Procure Digital Signature Certificate [DSC] for the proposed Director(s).
∙ Get Director Identification Number [DIN] for the proposed director(s).
∙ Select suitable Company Name, and make an application to the Ministry of Corporate Office for availability of name.
∙ Draft Memorandum of Association and Articles of Association [MOA and AOA].
∙ Sign and record various reports integrating MOA and AOA with the Registrar of Companies electronically.
∙ Portion of Requisite cost to Ministry of Corporate Affairs and moreover Stamp Duty.
∙ Examination of documents at Registrar of Companies [ROC].
∙ Receipt of Certificate of Registration/Incorporation from ROC.
Frequently Asked Questions:
- Might there be One Person Company?
It is an ideal substitute for Sole Proprietorship or it very well may be called as selected possession, as it contains a benefit as Limited Liability. Regardless, OPC could have no less than two bosses anyway have quite recently a solitary financial backer at a time. To select a One Person Company (OPC), simply a solitary individual is required.
- Might OPC anytime at any point be changed over into LLP?
For sure, An OPC can be changed over into LLP. To be sure it will in general be changed over into LLP. Notwithstanding, you truly need one more person in light of the fact that llp require least 2 man. Change is simply even you can see the value in control benefits in the LLP.
- Is FDI considered OPC in India?
No, FDI into a one individual association in India is bound.
- Might one person anytime association at some point have agents?
One Person Company (OPC) really means that there will be only a solitary financial backer of the association (you), having 100% of the offers. This associates with association ownership and not a tiny smidgen impacts your ability to enroll delegates. You could have various bosses in your OPC.
- Might OPC anytime be changed over into private confined association?
Vital Conversion of OPC. The Company Registration will be essentially different over itself into an OPC accepting that its settled up share capital outperforms ₹ 50 Lakhs and the yearly turnover outperforms ₹ 2 crores, then, it is expected for them for instance Organization convert itself into a private limited association.
- Might a NRI anytime Register a One Person Company in India? If without a doubt, what are the conditions for the same?
No, the same individuals than an Indian inhabitant or a Resident in India, can enroll a one individual association wherever in India. This suggests, a non-tenant Indian (NRI), or a distant public, can’t set up an OPC in India.
The possibility of One Person Company (OPC) in Bihar was acquainted with give a lift to business visionaries who can possibly begin their own endeavor by permitting them to make a solitary individual organization. Since, no intercession from any outsider is seen, it makes it more useful. Thus, if you need to fire up your own business, you don’t need to stress over every one of the mind boggling and dreary cycles. One Person Company in Bihar are helping immensely in expanding the general economy of India. An ever increasing number of Entrepreneurs are coming up and setting up their business. Since, no intercession from any outsider is seen, it makes it more advantageous. Since, no intercession from any outsider is seen, it makes it more useful.
Advantages of One Person Company registration:
Status of a Separate legitimate substance: An OPC enrollment in Bihar gets the situation with a different lawful element. The responsibility of every part is restricted to their portions and the advertiser isn’t by and by obligated for the misfortunes that have been caused.
Simple to get reserves: An OPC enlisted in Bihar is a different lawful element it is not difficult to raise assets through investments, private backers, hatcheries, and so forth. OPC Companies can benefit advances effectively than an ownership firm as they can undoubtedly acquire reserves.
Less Compliances: There are numerous exceptions to OPCs when it is Compliances under the Companies Act,2013. There is no requirement for the Company Secretary to sign the books of the records.
Simple fuse: OPC enrollment in Bihar is simple as only one part and one chosen one are expected for the consolidation. The part can be the Director as well. To enroll an OPC in Bihar a base settled up capital of Rs.1 lakh is required. Consequently, the joining system is extremely speedy and simple.
Simple to make due: One Person Companies are more straightforward to oversee as they can be laid out too as they can be controlled by a solitary individual. This settles on choice making fast and simple. This makes dealing with an organization simple as there is wont be any contention or postponement with the organization.
Interminable Succession: The Director needs to select an individual as a Nominee, on the passing of the part the candidate will run the organization.
Best reasonable for organizations with single advertiser able to venture into Corporate World Liability of the proprietor is restricted to the degree of capital Appointment of Nominee for getting a charge out of Uninterrupted Existence of the organization
Concentrated enrollment and Transparency in exchanges
Higher adaptability and less consistence prerequisites contrasted with Private Company
Detachment of the executives and possession is likewise conceivable in OPC
Employ Managerial Personnel without influencing share in proprietorship
Ease in Raising capital from Financial Institutions
Simplicity of Operations and organization
Higher Creditability from different associations the same Private Company
One Person Company (OPC) registration is a simple and straightforward process in India. It is a great way for small business owners to establish a separate legal entity without any partner. Here are some more details about the registration process:
Step 1: Obtain Digital Signature Certificate (DSC)
The first step in the registration process is to obtain a Digital Signature Certificate (DSC) for the director of the OPC. A DSC is an electronic signature that is used to sign digital documents. It is necessary for filing various documents with the Registrar of Companies (ROC).
Step 2: Obtain Director Identification Number (DIN)
The next step is to obtain a Director Identification Number (DIN) for the director of the OPC. A DIN is a unique identification number assigned to the director by the Ministry of Corporate Affairs. It is necessary for all directors of a company.
Step 3: Choose a Name and Get it Approved
The next step is to choose a unique name for the OPC and get it approved by the Registrar of Companies (ROC). The name should not be similar to any existing company or trademark. Once the name is approved, it is valid for 20 days.
Step 4: Prepare the Memorandum and Articles of Association
The next step is to prepare the Memorandum of Association (MOA) and Articles of Association (AOA) of the OPC. The MOA and AOA are the legal documents that govern the company’s relationship with its shareholders and other stakeholders.
Step 5: Obtain Certificate of Incorporation
Once the documents are ready, the next step is to file them with the Registrar of Companies (ROC) and obtain the Certificate of Incorporation. The Certificate of Incorporation is the legal proof of the existence of the OPC.
Step 6: Apply for PAN and TAN
After obtaining the Certificate of Incorporation, the next step is to apply for a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) for the OPC. PAN is required for opening a bank account, filing tax returns, and carrying out various financial transactions. TAN is required for deducting and collecting taxes.
Advantages of One Person Company Registration:
Limited Liability: The liability of the member is limited to the amount of capital invested in the company. This means that the personal assets of the member are protected.
Separate Legal Entity: An OPC is considered a separate legal entity from its member. It can enter into contracts, own assets, and sue or be sued in its own name.
Easy to Manage: An OPC can be managed by just one person, which makes it easy to manage and operate.
Better Credibility: An OPC has better credibility in the market compared to a sole proprietorship firm.
Disadvantages of One Person Company Registration:
High Compliance Cost: An OPC has to comply with various statutory and regulatory requirements, which increases the compliance cost.
Limited Expansion: An OPC cannot convert itself into a public or private company with more than one member, which limits its expansion.
In conclusion, One Person Company registration in Bihar India is a great option for small business owners who want to establish a separate legal entity without any partner. The registration process is simple and straightforward, and the advantages of an OPC outweigh the disadvantages.