One Person Company or OPC registration requires a minimum of one Director which may extend to a maximum 15 directors, and with only one subscriber. Both the Director and Subscriber may or may not be the same person, with no minimum paid-up capital limit. OPC registration is done as per the provisions Section 2(62) of the Companies Act 2013. One person company registration makes it easy for an individual to start a business with legal company registration.
One Person Company has a separate legal entity distinct from its member and Directors. OPC is more suited to freelancers or individuals who desire to have complete control of their business without the participation from any second person. OPC registration protects small entrepreneurs from the disadvantages of sole proprietorship and secures them with the status of a company.
A One Person Company is registered under the Companies Act with an entity distinct from its owner and Directors, i.e. Separate Legal Entity.
A One Person Company can be incorporated with a single person who may act as a director and a shareholder at the same time. However, a nomination is additionally required.
Compliances for Meetings & E-returns filling as per the Companies Act 2013 are less in number as compared to that for a Private Limited Company.
An OPC registration is one of the easiest forms of registering a business. Under a one person company, it is easier to raise funds and loans because the status of a company is better than a sole proprietorship.
Two names of the proposed Company are applied online with justifications for choosing the same.
DIN (Director Identification number) a unique number allotted to each Director and DSC (Digital Signature Certificate) an E-Signature token is applied for.
E-Form SPICe (INC-32) along with Articles of Association and Memorandum of Association are prepared, certified, and filled.
Basis the application, as the application is get approved, COI, PAN, and TAN get allotted in the name of the Company.
No, OPC can have only one member.
Yes, OPC can have more than one director, upto a maximum of 15 directors.
Voluntarily Conversion- After two years from the date of its incorporation
Compulsory- When the threshold limit (paid-up share capital) is increased beyond fifty lakh rupees, or its average annual turnover during the relevant period exceeds two crore rupees.
The OPC shall file form INC 5 within sixty days of an increase in threshold limit to inform ROC.
1. OPC cannot be converted into Section 8 Company.
2. Any business which carries out Non-Banking Financial Investment activities including investment in securities of anybody corporates.
A person can become a member in only one OPC at a time.
Two Board Meetings with a gap of at least 90 days between each meeting is required to be held by OPC only if there are more than one Directors.
No, a person who is a member of one OPC cannot become nominee in other OPC as he/she becomes a member in other company as a nominee. Hence, he/she will be required to surrender the membership in either of the two companies.
In India, under the Companies Act, 2013 there is no specific tax advantage for an OPC company. The one-person company registration is liable to pay tax at a flat rate of 22%. Any additional taxes like MAT and DDT are applicable just like other companies.
As per the Ministry of Corporate Affairs, only a natural person who is an Indian citizen and resident of India is allowed to register as a director, shareholder, or nominee of the OPC Company.
For one person company registration, there are certain mandatory legal compliances that should be followed. They are:
1. Maintenance of proper books of accounts.
2. Complying to the statutory audit requirements.
3. Annual timely submission and filing of Income tax returns before 30th September.
4. Filing of Financial Statements in Form AOC-4 and ROC Annual Return in form MGT 7.
The persons not eligible to form an OPC are:
1.A minor cannot become a member.
2.A Foreign national.
3.Non-resident of India.
4.Any person disabled to contract.
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