One Person Company Registration

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What is One Person Company?

To understand one person company definition, we first need to get into the identity it creates. A registration provides corporate status and many benefits to the members and directors. In the case of a Private company, at least two members are required which is not the same in the case of OPC. To eliminate this drawback and allow a single person to reap the advantages of One Person Company, this sort of a company structure is introduced through the Companies Act, 2013. One Person Company registration is simplified with online filing and process.

One Person Company feature is such that it has only one shareholder who owns 100% stake of the company. To maintain the character of perpetuity, the appointment of the nominee is compulsory, who will take place of the owner in case of death or his inability. One person company is a type of Private Limited Company.

Benefits of One Person Company

   Separate Legal Existence

A One Person Company would obtain the status of a separate legal entity. Such OPC registration ensures that the entity is separate from the owner, unlike a proprietorship firm. OPC can own the assets in its own name and enter into a contract with the parties. The actions of the company are independent of the owner. This is the main benefit of OPC registration.

   Lower Compliance Requirements

A Single Person Company is benefited with an exemption to many compliances unlike a private company. Compliances like holding General and Board Meeting, etc. are not applicable to OPC. However, Board Meeting must be held if more than one director is on Board.

    Limited Liability of Owners

One of the benefits of registering OPC lies in the separate legal entity of the company where the liability and obligations are not charged over the personal assets of the sole member. The liability of a member is limited to the unpaid amount of the capital subscribed by the member. Even in the case of liquidation, the personal assets of the member are protected, except in certain specified cases.

   Separation of Management and Ownership

Even if the OPC is owned by sole personnel, the owner may appoint a director owing up to the responsibility to operate and run a company. The operational duties are assigned to the director(s) whereas the member would be able to fetch profits channeling efforts towards other businesses. However, in One Person Company, the shareholder holds complete control over being a stakeholder.

Eligibility Criteria for OPC Registration

The following is the eligibility guidelines for OPC Registration in India.

  • Only a person who is a citizen of India and resident in India. Resident in India refers to a person who had lived in India for a time not less than 182 days in the preceding one year
  • Legal entities like company or LLP cannot join an OPC.
  • A nominee must be selected by the promoter while the incorporation.
  • The least authorized capital must be Rs 1 Lakh.
  • An OPC is restrained from operating a minor as its member.
  • If an OPC crosses a turnover of over Rs 2 crores or has a paid-up capital more than Rs 50 lakhs. It must be converted into a private or public within 6 months.
  • Least 1 Shareholder/Nominee/Directors

Documents Required For OPC Registration

  • 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)