The One Person Company (OPC), introduced under the Companies Act 2013, is a modern form of business aimed at supporting small entrepreneurs who wish to start and manage their businesses independently. Previously, the law did not allow the registration of a company with just one person. OPCs are similar to Private Limited Companies, sharing most of their features, including being separate legal entities from their promoters. The primary advantage of an OPC is that an individual can establish a business with 100% ownership, unlike other registrations like Private Limited Companies or Limited Liability Partnerships (LLPs), which require a minimum of two members. Additionally, in an OPC, a nominee must be appointed to assume ownership in case of the owner’s death. This unique structure is particularly beneficial for small businesses with a turnover of less than ₹2 crores and plays a significant role in fostering entrepreneurship and contributing to the growth of the Indian economy.
Checklist for Registering a One Person Company in India
In order for One Person Company (OPC) company to be registered in India, below are the conditions that have to be met
One Director
A One Person Company(OPC) must have at least one director.
Unique Name
The name of your business must be Unique. The recommended name should not match any current organizations or trademarks in India.
Minimum Capital Contribution
There is no Minimum capital Contribution to a company.
Registered Office
The registered office of an organization doesn’t need to be a business space. Indeed, even a leased home can be the registered office.
Shareholders
A single shareholder is enough to establish a One Person Company (OPC)
Shareholder Eligibility
The sole shareholder of a One Person Company (OPC) must be an Indian citizen
Required Documents for One Person Company Registration
For company registration in India the applicant should provide director and shareholder documents along with the proof of registered office address. Here is a list of the required documents for company incorporation:
- Passport size photos of directors and shareholders
- PAN card of all the directors
- Aadhar, Driving Licence, Passport or Voter ID of the directors
- Proof of residence
- NOC of the registered office address
- Utility bills for registered office proof
- Memorandum of Association (MOA)
- Articles of Association (AOA)
- Director and Shareholder Details
- Digital Signature Certificate (DSC)
- Director Identification Number (DIN)
Steps for One Person Company Registration Process
OPC registration procedure is easy but a professional would be needed to complete the same. In addition, the procedure has been completely changed by the government in order to promote the ease of doing business.
- Apply Digital Signature Certificate
The first step of the OPC Registration process is to apply for a Digital Signature Certificate to the directors of the proposed OPC . This is one of the important steps as the registration process of OPC is done online and requires the forms to be digitally signed. - Check for OPC Name availability
Before the process of registering OPC . We will ask you for a few names of your choices. We need to check the availability of the name to make sure it’s already not taken. Names can be checked on the MCA portal. This is done in order to avoid rejections. - Name Approval and Reservation
Name Approval or Name Reservation is the method of reserving a unique name via RUN (Reserve Unique Name) submission form. A list of two proposed names of the OPC will be submitted to the authority for approval. The ROC reserves a name out of two names, and the OPC registers with the same name. The Registrar will approve the name only if it is not considered undesirable by the Central Government. Nor name should not relate in any way to any of the existing partnerships, OPC , trademarks or corporate entities. - MOA & AOA Submission
Once the name has been approved, it is necessary to draft up a Memorandum of Association and Articles of Association. Both MOA and AOA are registered with the declaration of agreement of the MCA. - Get Incorporation Certificate of LLP
When the Registrar approves your MOA and AOA, you’re closer to having your OPC licensed. The next step is to obtain an OPC Incorporation Certificate. You can do this by submitting all the documents to the Registrar. The time frame is between 2 and 6 days. Once you have your OPC Incorporation Certificate, you ‘re ready to go - Apply for GST and Current Account
Once the company gets incorporated one has to apply for GST according to the threshold limit. After this, you should submit an Incorporation Certificate, MOA, AOA and PAN to a bank to open your bank account.
Highlights of Incorporating a Company in India
A One Person Company (OPC) allows a single individual to own and manage a business as a separate legal entity, offering limited liability and 100% ownership. It is ideal for small businesses with a turnover under ₹2 crores and requires appointing a nominee for succession.
- Limited Liability
OPC is sole proprietorship business with limited liability features. - Single Owner
The key feature of OPC is One Person Company managed by a single owner. - Separate Legal Entity
OPC is a separate legal entity from his/her owner in the eyes of law. - Share Transferability
OPC owner’s equity cannot be transferred freely to others. - Lesser Compliances
OPC requires less compliances as compare to private & public limited. - Nomination
One nominee required who will take over OPC in case owner absence.
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FAQs on One Person Company
To make things easier, we’ve answered some of the most common questions about One Person Company registration. These FAQs will help you understand each step clearly and give you the confidence to move forward. Explore the answers below and take the first step toward building your business.
One Person Company (OPC) is the most modern form of business that came into existence by the company’s Act 2013. This concept of One Person Company(OPC) was mainly brought in to help out the small entrepreneurs who want to start there own business and who think they can manage their business on there own itself.
Yes, the incorporation cost is cheaper than the Private limited company
Any individual who is a resident and citizen in India would be eligible to incorporate a One Person Company(OPC).
No, an individual can’t incorporate multiple One Person Company(OPC)
No, a minor is not eligible to be a member or a director or a shareholder of a One Person Company(OPC).
Yes’ a One Person Company(OPC) can be converted into a PVT Limited company whenever the shareholder wants to do so.
It gives credibility to business in the eyes of financial institutions, providers and potential customers. As it makes it simpler for companies to get loans at ideal terms from banks or convincing potential customers while going into bargains.
Yes, It is necessary to mention the word OPC in all the official documents where ever the company name is mentioned.
Types of Company Registration
Under the Companies Act of 2013 different types of business entities can be registered. Each and every business entity has its own set of benefits and drawbacks. Here is a complete outline of different business entities and their corresponding information.
| Private Limited Company | One Person Company | Limited Liability Partnership | Partnership Firm | Proprietorship Firm | |
|---|---|---|---|---|---|
| Recommended For | Start-ups and growing companies | Sole promoters | Professional services firms | Home businesses | Small traders and manufacturers |
| Ease of Accommodating Investment | Very easy to accommodate | Possible, but severely unlikely | Possible, but unlikely | Almost impossible | Impossible |
| Limited Liability Protection | Yes | Yes | Yes | No | No |
| Tax Advantages | Few benefits | Few benefits | Few benefits | Minimal | Most efficient |
| Perpetual Existence | Yes | Yes | No | No | No |
| Statutory Compliances | High | High | Minimal | Low | Low |