For Free Consultation, Please contact us at +91 8000028250

OPC TO PRIVATE LIMITED COMPANY

Starting at just Rs. 8,000 * +Government fees (at actual)

Conversion of OPC TO PRIVATE LIMITED COMPANY

The One Person Company (OPC) is a newly incorporated type of company and was introduced in the Companies Act, 2013 to support entrepreneurs who on their own are capable of starting a venture by allowing them to create a single person economic entity. There can be only one, natural person resident of India who can be the member of OPC. However, there is no restriction on maximum number of Directors. But sometimes, there might be a situation when the single member intends to expand the broad base of the Company for its better growth and future prospects.

Converting One Person Company to a Private Company can open avenues to pursue additional benefits such as fund raising.

There is TWO METHODS for conversion of OPC into Private Limited Company:

When an OPC is incorporated, the conversion cannot happen before two years. The procedure of voluntary conversion of an OPC into a private limited company falls under the section 18 of the Companies Act.

The company can convert into another company coming under the same act by the modification of the memorandum of the association and articles of the association in accordance with the provisions.

An application has to be made by the company to register along with the relevant documents which are essential for the conversion.

On submission of all relevant documents, the registrar has the power to issue a certificate of incorporation.

The registration of the company under this act will not affect any liabilities, debts, or obligation before and after the conversion.

When an OPC has paid up share capital that exceeds Rs.50 lakhs and the annual turnover is above Rs.2 crores, then it is obligatory for them to convert into a private limited company.

During the conversion, the members have to just pass a special resolution in the general meeting.

Before the resolution is passed, a No objection Certificate has to be taken in writing from the creditors, and the other members.

Within fifteen days of the passing of the resolution, company needs to file an application to the registrar along with a copy of the resolution.

After the application is filled and the fee paid, the registrar then makes a decision after studying the documents and issues the certificate of conversion.

Note: E-Forms are now filed with the Registrar of Companies.

BENEFITS OF COMPANY CONVERSION TO PRIVATE LIMITED COMPANY

  • Easier To Raise Funds

    Raising funds as a private limited company is a comparatively easy task as it gives an opportunity for raising shares and has many ways to raise funds in the form of private equity, ESOP, and more.

  • Limited Liability Of Owners

    The obligation or debts of the company does not create a charge over the owner’s personal assets. Their liability is limited only to the subscribed capital unpaid by them.

  • Taxation Benefits

    One Person Company is not recognized under the Income Tax Act and hence it has been put in the same category as other companies for taxation purpose. Private companies have been placed under the tax bracket of 30% on total income. Thus, from the perspective of taxation, the concept of One Person Company becomes a less profitable concept as it imposes a heavy financial load.

  • Separate Legal Existence

    A Private Limited Company is registered; a legal entity is born in eyes of law, which is separate from its owners and managers. The company can operate in its own name from opening a bank account to own assets and enter into a contract with parties. This also provides the capacity to sue third parties.

Package Includes

  1. 1 no. Class 2 Digital signature
  2. 2 Director Identification Numbers
  3. 1 RUN Name Approval
  4. Upto 5 Lakhs Authorized Capital
  5. MOA & AOA
  6. Incorporation Fee
  7. Stamp Duty
  8. Incorporation Certificate

Documents Required

  • PAN Card of shareholders and Directors. Foreign nationals must provide a passport.
  • Voter ID/ Passport/ Driving License of Shareholders and Directors
  • Telephone Bill /Electricity Bill/ Latest Bank Account Statement of Shareholders and Directors
  • Latest Passport size photograph of Shareholders and Directors
  • In case of NRI or Foreign National, documents of partner must be notarized or apostilled.
  • Duly certified copy of latest audited Financial Statements.
  • Certificate of Incorporation, MOA & AOA to be provided
  • Copy of No Objection letter of secured creditors.
  • List of members and list of creditors

POST CONVERSION REQUIREMENTS

 

  1. Arrange new PAN No. of the company
  2. Arrange new stationary with new name of the Company
  3. Update company bank account details
  4. Intimate all the concerned authorities like Excise and sales tax etc about the status change

E. Printed copy of new MOA & AOA.

Why Choose LEGALSAHAYATA?

Low Price

No Office Visit

No Hidden Cost

Charges After Work Completion

Frequently Asked Question

In case of One Person Company, there is no convene an extra ordinary general meeting like private and public Companies. As per the provisions of Section 122 of the Companies Act, 2013, in case of OPC, it shall be sufficient if the resolution is communicated by the member to the Company and entered in the minutes-book and signed and dated by the member and such date shall be deemed to be the date of the meeting for all the purposes.

Yes, the Directors shall be appointed before as the e-Form INC-6 asks for the same.

No, the One Person Company can have only one member and therefore the Company cannot increase the members before conversion. However, after conversion, it shall increase the number of members to meet the minimum compliance requirement.

After the OPC is converted into a Private Limited Company, it is obligatory for the company to increase its paid-up share capital to ₹ 50 Lakh or the annual turnover to  ₹ 2 Crore or more. If the company fails to comply with these provisions, it shall covert back itself to an OPC by passing a special resolution.

The OPC must convert itself into a Private Company in case of the following situations:
– If the paid-up share capital of the OPC hits more than  ₹  50 lakh.
– If the annual turnover exceeds   ₹ 2 crores consecutively for the last three (3) years.

NO, an OPC cannot be incorporated as or converted into a company for non-profit, charitable purpose, and it cannot carry out non-banking, financial, or investment activities including investment in securities of any corporate body.

After the conversion, the liabilities, debts or obligation of the company shall not be affected in any way. Hence, the company shall be liable for all its previous obligations.

Shopping Basket
Need Help?