What is OPC (One Person Company) Registration?
In recent years, the One Person Company (OPC) has been promoted as a good refinement of the sole proprietorship. In an OPC, a single promoter acquires full control of the firm, limiting his or her accountability for the company’s contributions. As a result, the named individual will be the sole shareholder and director (however, a director nominee is present, but has zero power until the real director proves incapable of getting into the contract). There will also be no opportunity for employees to contribute to employee stock options or equity investment.
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Documents required for OPC Registration
The OPC’s director shall submit scanned transcripts/copies of the following papers, which are required for OPC registration:
- PAN card or Passport
- Passport, for NRIs and Foreign Nationals
- Scanned transcript of Driver’s License or Voter’s ID
- Updated gas or electricity invoice/Bank account Statement/Mobile or landline phone invoice
- Specimen signature or impression
- passport-sized photo
Please note that the OPC director must self-attest the first three documents. All documentation for a foreign national or NRI must be notarized or apostilled (if the foreign national or NRI is currently residing in India or a non-Commonwealth country) (if living in a Commonwealth country at present).
Documents Required For The Registered Office
- Scanned transcript of Current Bank Account Statement/Phone or Mobile Invoice/Gas or Electricity Invoice)
- Scanned transcript of Rental Agreement written in the English language
- Scanned transcript of NOC or No-objection Certificate from the concerned property landowner
- Scanned transcript of Property or Sale Deed printed in English (if the property is owned)
Note: Your registered office premises must be a commercial place; however, it can also be your home.
What is included in the OPC Registration package?
- Directors Identification Number for 1 Director
- Digital Signature Certificate for 1 Director (If the shareholders are different from directors, then additional
- DSC is required for Shareholders)
- Guidance for choosing the Company Name
- PAN Number
- TAN Number
- The registration process includes – Drafting the Memorandum & Articles of Association, RoC filing fees for an authorized capital, Government Stamp Duty, and Certificate of Incorporation.
- Name Approval Certificate
- GST Registration
- PF Registration
- ESI Registration
- PT Registration (Only applicable in Maharashtra)
- Zero Balance Current Account – From our preferred banking partners*
Benefits of OPC Registration
In a private limited company, the directors’ personal property is always safe, regardless of the company’s debts.
When the proprietor dies, the sole proprietorship comes to an end. Due to the fact that an OPC company has its own legal identity, it would pass to the nominee director and so continue to exist.
Because an OPC’s finances must be audited every year, it has more trust with vendors and financial institutions.
FAQs on All You Need to do a One Person Company Incorporation
☑ What are the benefits of an OPC registration?
An OPC is a good option to running a sole proprietorship since it limits the business owner’s liability. This means that your obligation is limited to the amount you put in the business; personal assets cannot be used to repay corporate debts. In addition, when the promoter of a sole proprietorship dies, the business ceases to exist. The nominee director takes over in the case of an OPC, and the entity continues to exist. Single entrepreneurs without a business partner may want to explore forming a private limited company.
☑ Who can register for an OPC?
As per the Ministry of Corporate Affairs’ specifications, OPC business registration can only be done by Indian residents, and only one at a time.
☑ What are the OPC’s mandatory requirements?
All such businesses are required to keep books of accounts, adhere to statutory auditing requirements, and file income tax returns and annual reports with the RoC.
☑ How much capital will it require to start an OPC?
The capital requirements for an OPC and a private limited corporation are identical. It requires an initial authorised capital of Rs. 1 lakh, but none of this needs to be paid up. This implies that you do not need to put any money into the company.
☑ What tax benefits are available to an OPC?
There are no general benefits, although there are certain industry-specific benefits. Dividend Distribution Tax, as well as Minimum Alternate Tax, must be paid at a flat rate of 30% on profits.
☑ What is the most significant disadvantage of an OPC?
The MCA is concerned about a huge firm being run by a single person. As a result, once an OPC’s revenue reaches a particular threshold, it must be changed into a private limited or public limited company. Currently, an OPC must be converted into an OPC if it has had an average turnover of Rs. 2 crore or more for the previous three years or has a paid-up capital of more than Rs. 50 lakh.
☑ What does it cost to run an OPC?
An OPC is just marginally less expensive than a private limited company. You’ll spend roughly Rs. 12,000 to incorporate, then around Rs. 15,000 each year in compliance costs and an auditor to go over company finances.
☑ In an OPC, how many directors can there be?
There are certain limitations to using an OPC. The sole director and shareholder of the company is the person who founded it. A nominated director is also present, but this individual has no authority to raise equity money or give employee stock options. The nominee’s sole purpose is to take over in the event of the director’s death or incapacitation. The director selects the nominee, who can be anyone, including your spouse, parents, or siblings. During registration, the candidate will be required to submit proof of identity.
☑ Is it possible to run multiple OPCs at the same time?
No, each person can only form one OPC at a time. This rule also applies to an OPC nominee.
OPC Registration Process Duration
5 business days
To begin, the OPC director should petition or apply for a DSC, or Digital Signature Certificate, which is required to be filed with the company’s registration documents. All that is required is the submission of a few scanned documents, after which our agents will file the form by filling it out and submitting it online.
7 Business Days
Once you’ve completed the DSC application, our agents will ask you to choose a business name and provide us the necessary scanned documents. The MoA, also known as the Memorandum of Association, and the AoA, commonly known as the Articles of Association, will be used to file for the SPICe, i.e. INC-32. Finally, the Certificate of Incorporation will be processed and approved at the end of this procedure.
2 Business Days
A registered PAN (Permanent Account Number) and TAN (Tax Account Number) are required for all businesses. Our representatives will file the application electronically, but you will be needed to courier the physical copies of the relevant and required documents yourself. After processing, you will receive your TAN and PAN within 21 working days at your registered office address.
The Law For The Formation Of One-Person Companies Is Passed By Parliament
November 18th, 2020
The ‘Companies (2nd Amendment) Bill, 2020′ was accepted and passed by parliament after Commerce Minister Tipu Munshi pushed it through. It included a provision for the incorporation of ‘One-Person Companies.’ This will open the door to new investments and improve the company’s global ease of doing business rankings. The company’s owner and shareholder will be a single person, according to the newly passed bill.
Companies (Amendment) Bill, 2020
March 30th, 2020
Section 446B of the Act has been changed. The monetary penalty for start-ups, one-person companies, producers, and small businesses has been reduced. This will facilitate ease of doing business.
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We take care of all the paperwork so that your interactions with the government proceed as smoothly as possible. We’ll also provide complete transparency into the process so you can set realistic expectations.
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If you have any questions about the process, our team of experienced business consultants is just a phone call away. However, we will make every effort to clarify any doubts you may have before they arise.