One Person Company: An Overview

An OPC is the most modern form of business in India proposed by the Companies Act, 2013 and understand as One Person Company.

You can easily register one person company under the outlines of the companies Act 2013 and the laws thereto, where it was made viable for a single-person company to work as a company without the complexity of having partners. This encourages more people to come forward to commence a business. The OPC is fit for small businesses where the turnover is not likely to cross Rs. 2 Crores. IN OPC Registration it’s important to note that the nominee or the director should be an Indian Resident.

By incorporation of OPC, the company can enjoy the benefits of banking points and be eligible for Banking loans, and credits. So, if you want to start up your own business, you don’t have to worry about all the network and slow processes.

Advantages of OPC

Legal status   
The OPC receives a separate legal entity status from the member. The separate legal entity of the OPC gives protection to the single individual who has incorporated it. The liability of the member is limited to his/her shares, and he/she is not personally liable for the loss of the company.  Thus, the creditors can sue the OPC and not the member or director.

Easy to obtain funds   
Since OPC is a private company, it is easy to go for fundraising through venture capital, angel investors, incubators etc. Banks and Financial Institutions prefer to grant loans to a company rather than a proprietorship firm. Thus, it becomes easy to obtain funds.

Fewer compliances   
The Companies Act, 2013 provides certain exemptions to the OPC regarding compliances. The OPC need not prepare the cash flow statement. The company secretary need not sign the books of accounts and annual returns and be signed only by the director.

Easy incorporation   
It is easy to incorporate OPC as only one member and one nominee is required for its incorporation. The member can be the director also. The minimum authorised capital for incorporating OPC is Rs.1 lakh but there is no minimum paid-up capital requirement. Thus, it is easy to incorporate as compared to the other forms of company.

Easy to manage   
Since a single person can establish and run the OPC, it becomes easy to manage its affairs. It is easy to make decisions, and the decision-making process is quick. The ordinary and special resolutions can be passed by the member easily by entering them into the minute book and signed by the sole member. Thus, running and managing the company is easy as there won’t be any conflict or delay within the company.

Perpetual succession   
The OPC has the feature of perpetual succession even when there is only one member. While incorporating the OPC, the single member needs to appoint a nominee. Upon the member’s death, the nominee will run the company in the member’s place. 

Documents Required

Copy of PAN Card of owner

Passport-size photograph of the owner

Copy of Aadhaar Card/ Voter identity card

Copy of Rent agreement (If rented property)  
 

Electricity/ Water bill (Business Place)  
 

Copy of Property papers (If owned property)  
 

Landlord NOC (Format will be provided)