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OPC REGISTRATION

Single owner, more opportunities.


Starting at Rs. 5,999 (all inclusive)

One Person Company (OPC) Registration

One Person company is a concept introduced in India by the Companies Act, 2013. The concept opens up new vistas of business opportunities and particularly spectacular possibilities for sole proprietorship and entrepreneurs who can enjoy the advantages of limited liability and the benefit of separate legal entity as well.

One Person Company has been provided with concessional /relaxed requirements under the Companies Act, 2013. Now a single national person can constitute a Company, under the One Person Company (OPC).

OPC Benefits

The benefits emanating of OPC Registration are many, to name a few ,

OPC Limitation

An OPC as an option for start-ups might seem very appealing, but it does come with its share of disadvantages

Only a natural person who is an Indian citizen and resident in India shall be eligible to incorporate a One Person Company.
This provision discourages foreign direct investment by disallowing foreign companies and multinational companies to incorporate their subsidiaries in India as a One Person Company. Hence, an OPC will have to change their legal status to a private limited company to bring in investors. Foreigners and NRIs are allowed to invest in a Private Limited Company under the Automatic Approval route where 100% FDI is available in most sectors.

Since an OPC can have only one shareholder, there can be no sweat equity shares or ESOPs to incentivize employees. ESOPs can only be implemented if OPC converts into a private or public limited company. A private or public limited company can easily expand by an increase of authorized capital and further allotment of shares to even third parties.
Hence, a private company is a preferable option for start-ups who want to encourage their employees by way of stock options.

Under the tax rate slab, OPC’s income is taxed at 30% of its entire income in the fiscal year. This is slightly higher than the tax slab rate for people which are 10% to 30% of the income depending upon the income of such person.

What Is Included In Our OPC Registration Package?

Documents required for registration of an OPC

  1. Scanned copy of PAN Card
  2. Scanned copy of Passport, Voter’s ID or Driver’s License
  3. Scanned copy of Current Bank Account Statement/Phone or Mobile Invoice/Electricity or Gas Invoice
  4. Scanned passport-sized photo

Priority Sector Lending - Reserve Bank of India

The Reserve Bank of India under its Master Circular No. RBI/2013-14/ 107 RPCD.CO. Plan.BC9/04.09.01/2013-14 dated July 01, 2013 has instructed all Scheduled Commercial Banks (excluding Regional Rural Banks) to increase their involvement in financing of priority sectors, viz., agriculture and small scale industries. The Master Circular provides for the following activities as being eligible for priority sector lending:

Manufacturing Sector

Enterprises

 

Investment in Plant and Machinery

Micro Enterprises

Do not exceed twenty five lakh rupees

Small Enterprises

More than twenty five lakh rupees but does not exceed five crore rupees

Service Sector

Enterprises

 

Investment in Equipment

Micro Enterprises

Do not exceed ten lakh rupees

Small Enterprises

More than ten lakh rupees but does not exceed two crore rupees

One Person Company coming under any of the above categories may fall under priority sector lending. There is enormous scope for One Person Companies to leverage benefits of priority sector lending.

OPC structure would be similar to that of a proprietorship concern without the ills generally faced by the proprietors. One most important feature of OPC is that the risks mitigated are limited to the extent of the value of shares held by such person in the company. This would enable entrepreneurial minded persons to take the risks of doing business without the botheration of litigations and liabilities getting attached to the personal assets

In OPC the business head is the decision maker, he is not dependent on others for suggestions or implementation of suggestions etc., resulting in quicker and easier decision making. He is the sole person who runs the business and hence, the question of consensus or majority opinion etc., does not arise.

Privileges available to OPC

Some of the privileges and benefits identified with OPCs are:

• OPCs would provide the start-up entrepreneurs with new business idea.
• OPC provides an outlet for the entrepreneurial impulses among the professionals.
• The advantages of limited liability. The most significant reason for shareholders to incorporate the ‘single-person company’ is certainly the desire for the limited liability.
• OPCs are not proprietorship concerns; hence, they give a dual entity to the company as well as the individual, guarding the individual against any pitfalls of liabilities. This is the fundamental difference between OPC and sole proprietorship.
• Unlike a private limited or public limited company (listed or unlisted), OPCs need not bother too much about compliances.
• Businesses currently run under the proprietorship model could get converted into OPCs without any difficulty.
• OPCs require minimal capital to begin with. Being a recognized corporate, could well raise capital from others like venture capital financial institutions etc., thus graduating to a private limited company.
• Mandatory rotation of auditor after expiry of maximum term is not applicable.​

Why to Choose Legalsahayata?

Low Price

No Office Visit

No Hidden Cost

Charges After Work Completion

Process of Incorporation of One Person Company (OPC)

Frequently Asked Question

Only a natural person who is an Indian citizen and resident in India shall be eligible to act as a member and nominee of an OPC.
For the above purpose, the term “resident in India” means a person who has stayed in India for a period of not less than one hundred and eighty two days during the immediately preceding one financial year.

A person can be member in only one OPC.

In case the paid up share capital of an OPC exceeds fifty lakh rupees or its average annual turnover of immediately preceding three consecutive financial years exceeds two crore rupees, then the OPC has to mandatorily convert itself into private or public company.

Where a natural person, being member in One Person Company becomes a member in another OPC by virtue of his being a nominee in that OPC, then such person shall meet the eligibility criteria of being a member in only one OPC within a period of one hundred and eighty days, i.e., he/she shall withdraw his membership from either of the OPCs within one hundred and eighty days.

No, you are not permitted to form more than 1 OPC and nominee in your company cannot be selected as the nominee in any other OPC company.

A lot of people considering an OPC registration go with the private limited company structure because it is mandatory to convert an OPC to a private or public limited company if turnover is over Rs. 2 crores or paid-up capital is over 50 Lakhs.

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