One Person Company Registration

What is a One Person Company (OPC)?

An OPC is a type of private limited company that is designed for a single owner. Introduced under the Companies Act, 2013, this business structure allows individuals to register as a company with limited liability without the need for a co-founder or partner. This is especially beneficial for sole entrepreneurs who wish to enjoy the advantages of a private limited company (pvt ltd) without the complexities of partnership or multiple shareholders.

Key Benefits of One Person Company Registration

• Limited Liability Protection: The owner’s liability is limited to the capital invested in the company, safeguarding personal assets from business debts.
• Separate Legal Entity: Like any private limited company, an OPC is a separate legal entity that can hold assets, sue, or be sued in its name.
• Less Compliance: Compared to private limited or public companies, OPCs have fewer compliance and reporting requirements, making them easier to manage for single-owner businesses.
• Easy Transition to Pvt Ltd: If the business grows and requires multiple shareholders, OPCs can easily convert to a private limited company as per compliance guidelines.

Requirements for OPC Registration

To register an OPC, ensure you meet the following requirements:

1. Minimum Director and Shareholder: Only one person can be the director and sole shareholder of the OPC. However, a nominee must be appointed to take over the company’s affairs in case of the director’s incapacity or death.
2. Capital Investment: There is no minimum paid-up capital requirement, making it flexible for small business owners.
3. Unique Company Name: The company name should end with “OPC Pvt Ltd” and must be unique to avoid duplication in the register of companies.

Documents Required for OPC Registration

To ensure a smooth company registration process, gather the following documents:

• Director’s Identity Proof: PAN card, passport, voter ID, or Aadhaar.
• Director’s Address Proof: Utility bill, bank statement, or rent agreement.
• Registered Office Address Proof: Lease agreement or property ownership documents, along with a No Objection Certificate (NOC) from the owner.
• Nominee’s Consent: A consent form from the nominee (Form INC-3), including their ID and address proof.

Step-by-Step OPC Registration Process

Step 1: Apply for Digital Signature Certificate (DSC)

A Digital Signature Certificate (DSC) is required for electronic filing of forms with the Ministry of Corporate Affairs (MCA). The director must obtain a DSC from a government-approved certification agency.

Step 2: Obtain Director Identification Number (DIN)

The Director Identification Number (DIN) is mandatory for the OPC director and can be applied online using Form DIR-3 on the MCA portal.

Step 3: Name Reservation

Submit an application for the name of the company using the RUN (Reserve Unique Name) service on the MCA portal. The proposed name must adhere to naming conventions, end with “OPC Pvt Ltd,” and should not resemble any existing registered company.

Step 4: File the Incorporation Application (Form SPICe+)

The incorporation of the OPC can be filed through the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form. Attach the required documents, including the Memorandum of Association (MOA) and Articles of Association (AOA), along with the identity and address proofs of the director and nominee.

Step 5: Issuance of Certificate of Incorporation

After verifying the submitted documents, the Registrar of Companies (ROC) will issue a Certificate of Incorporation. This certificate contains the unique Company Identification Number (CIN) and is proof of the company’s registration in the register of companies.

Step 6: Apply for PAN and TAN

Upon successful incorporation, apply for the company’s PAN and TAN, which are essential for business registration and compliance purposes.

Step 7: Open a Bank Account

Use the Certificate of Incorporation, PAN, and other relevant documents to open a bank account in the name of the OPC to facilitate financial transactions.

Fees and Cost of OPC Registration

The cost to register an OPC varies based on professional fees, government charges, and additional service fees for document processing. Here’s a breakdown of the major cost components:

• Government Fees: This includes registration fees, stamp duty, and other applicable charges, which vary based on the authorized capital of the company.
• Digital Signature and DIN Fees: These are nominal charges for obtaining the DSC and DIN.
• Professional Fees: If you hire a company registration service provider, professional fees will apply.

Generally, OPC registration fees in India range from ₹4,000 to ₹15,000, depending on the state and service providers.

Conversion of OPC to Pvt Ltd Company

An OPC can voluntarily convert to a private limited company after two years from the incorporation date or mandatorily upon reaching a turnover threshold of ₹2 crore or more. The conversion process includes filing specific forms, appointing additional shareholders, and modifying the company’s AOA and MOA.

Compliance and Annual Filing Requirements for OPCs

Once registered, OPCs must comply with certain annual requirements:

• Financial Statements: Filing the balance sheet, profit and loss statement, and other financial records with the ROC.
• Annual Returns: Submitting the Annual Return (Form MGT-7A) within 60 days from the financial year-end.
• Income Tax Filings: Regular filing of income tax returns under the Income Tax Act.

Frequently Asked Questions (FAQs) on OPC Registration

1. Can a foreigner or NRI register an OPC in India? No, only a resident Indian can register an OPC. However, an NRI or foreigner can invest in a private limited company.

2. What is the difference between an OPC and a private limited company? An OPC is limited to a single shareholder, while a private limited company requires at least two shareholders. OPCs are suitable for small businesses and solo entrepreneurs, whereas private limited companies are ideal for larger, scalable businesses.

3. Is OPC registration free? No, OPC registration incurs government and professional fees, although some aspects may be subsidized.

4. How long does OPC registration take? The process typically takes 5–10 business days, depending on document verification and approvals.

5. Can an OPC be converted to a private limited company? Yes, OPCs can be converted to private limited companies once they meet specific conditions or voluntarily after two years.

Conclusion

Registering an OPC offers a streamlined way for solo entrepreneurs to start a business with the added security of limited liability. This guide has provided a detailed overview of the OPC registration process in India, from understanding its benefits and requirements to step-by-step instructions on how to register a company. As a new or aspiring business owner, you now have the insights needed to take that first step toward business incorporation and formalize your entrepreneurial vision.

By following this comprehensive guide, you can navigate the entire OPC registration process with ease, ensuring you meet all legal requirements and secure your company’s foundation in India.