A One Person Company (OPC) is managed and controlled by a single individual, minimizing his/ her accountability for contributions to the enterprise. A director nominee, on the other hand, is present but has no authority until the actual director is unable to continue. This comprehensive guide will help you understand all bout One Person Company in India.
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What is One Person Company?
One Person Company Registration concept is introduced in the year 2013 under the Companies Act of 2013. This has brought so many changes and provided many opportunities for all budding entrepreneurs to start their single-person economic enterprise. It is a refinement of a Sole proprietorship.
A company can be founded with only one director and one member, according to section 2 (62) of the Companies Act of 2013.
A One Person Company Registration in India is a type of entity with the fewest compliance requirements of any company type. Because it is administered by a single person, an OPC is simple to manage. If you are an entrepreneur seeking unique success, you can register as an OPC in India.
Why choose One Person Company Registration?
One Person Company Registration offers numerous advantages over a sole proprietorship. Having a registered company under Ministry of Corporate Affairs (MCA) increases the legitimacy of your business.
What are the benefits of One Person Company?
There are lots of benefits for One Person Company which are as follows;
- Single Proprietor can form a corportaion
- Unlike a Sole Proprietorship, your business name is protected and cannot be replicated by others.
- A decrease in compliance.
- Its director’s liability is limited.
- Suitable for bank loans and credit.
- Lower income tax rate when compared to a Sole Proprietorship.
- No involvement from a third party is permitted.
- Ownership is easily transferrable to a nominee in the event of the owner’s death.
What is the eligibility for One Person Company Registration?
- The company’s Director/ shareholder must be an Indian citizen and a resident of India. NRIs and foreign nationals are not permitted to register for OPCs in India.
- Before registering a One Person Company, the proprietor must be 21 years old. Minor is unable to function as a member.
- There is no minimum capital requirement for a one person company. An OPC can be formed with a paid up capital of INR 1 Lakh.
- An OPC, on the other hand, must be registered with a minimum authorized capital of INR 1 Lakh.
- Your company’s name must be distinct and unique.
- The suggested company name should not be similar to any existing registered Indian companies or trademarks.
What are the documents needed for OPC Registration?
- Scanned copy of recent bank statement
- Bank statements can be accessed via Internet banking or by visiting a bank branch.
- Account statements and transaction summary statements are two additional standard titles for them.
- Utility Bills for power or gas, a phone bill, and a mobile bill
- Utilities often include power, gas, water/sewage, and garbage disposal.
- Other services, such as internet, cable TV, and phone service, are occasionally viewed as extra utilities because they are now considered standard in most Indian households.
- The cost of utilities might vary greatly based on your location, the temperature where you reside, and your usage habits.
As a result, these are also presented as critical documents for OPC registration.
Digital transcription of a landowner’s No Objection Certificate
This document comes from the specific landowner. Section 12 of The Companies Act, 2013 requires that every corporation maintain a registered address. When a company is incorporated in India, the registered address is attached to the Spice+ form. If the business’s address changes after formation, a Form INC-22 notification of the company’s new registration address must be sent to the Registrar of Companies (RoC).
An English-language scanned copy of the property deeds or sale deeds if the property is owned.
A sale deed is a legal document used in real estate transactions to confirm the purchase of property and the transfer of ownership from the seller to the buyer. This is the primary ownership transfer documentation. A sale deed is also known as a conveyance deed or a final deed.
What are the process in registering One Person Company?
Registering One Person Company is quick, simple, and can be done online with a few easy steps:
- Obtain a DSC and DIN:
- Obtaining Digital Signature Certificate (DSC) and Director Identification Number (DIN) are mandatory requirements for registering any company in India. You can obtain these online by visiting the website of the MCA or through a government-approved agency.
- Choose a unique name for your OPC:
- You need to choose a unique name for your company that does not conflict with any existing trademarks or company names. You can check the availability of your chosen name on the MCA website.
- File incorporation documents:
- You need to prepare and file various documents for incorporation, including the Memorandum of Association (MOA) and Articles of Association (AOA) of the company, as well as a declaration from the sole member of the company. You can prepare and file these documents online through the MCA website.
- Pay the registration fee:
- Once your documents are verified, you will need to pay the registration fee online. The fee depends on the authorized share capital of the company.
- Obtain Certificate of Incorporation:
- After successful registration, you will receive a Certificate of Incorporation from the RoC. This certificate is proof that your OPC is now a legal entity in India.
- Apply for PAN and TAN:
- Finally, you need to apply for a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) for your OPC. You can apply for these through the NSDL website.
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In conclusion, a One Person Company provides a simple and efficient way for single entrepreneurs to establish their businesses legally. With minimal compliance requirements and the ability to protect your business name, OPC registration offers several benefits over sole proprietorships.
By following a straightforward registration process and ensuring all necessary documents are in order, entrepreneurs can quickly establish their OPC and focus on growing their ventures. If you’re considering starting your own business, OPC registration might be the perfect option for you!
FAQs
1. What are the key documents required for One Person Company Registration?
The essential documents include a scanned copy of recent bank statements, utility bills, digitally transcribed rental agreement, digital transcription of a landowner’s No Objection Certificate, and scanned copies of property deeds.
2. Can a foreign national or NRI register a One Person Company in India?
No, as per the eligibility criteria, only Indian citizens who are residents of India can register as directors/shareholders for an OPC. Foreign nationals and NRIs are not allowed to form OPCs in India.
3. Is there a minimum capital requirement for registering a One Person Company?
There is no specific minimum capital requirement for an OPC. It can be formed with a paid-up capital of as low as Rs. 1. However, it must be registered with a minimum authorized capital of INR 1 Lakh.
4. How is the process of registering a One Person Company conducted?
The registration process involves obtaining a DSC and DIN, choosing a unique name, filing incorporation documents such as MOA and AOA, paying the registration fee, obtaining the Certificate of Incorporation, and applying for PAN and TAN.
5. What are the benefits of opting for OPC Registration over a Sole Proprietorship?
Some advantages of OPC registration include protection of the business name, reduced compliance requirements, limited liability for the director, eligibility for bank loans and credit, lower income tax rates compared to a sole proprietorship, and the ease of ownership transfer to a nominee in case of the owner’s demise.
