One Person Company (“OPC”) is defined under Section 2(62) of the Companies Act, 2013. The OPC is governed under the guidelines of Registrar of Companies (ROC) and the Company Law.
With a view to restructure the concept of Sole Proprietorship along the lines of a Private Limited Company in which the Founder has limited liabilities and his personal assets are safe, the government has come up with the concept of One Person Company.
One Person Company can have maximum 15 Directors in its board. There is a mandatory condition in an OPC that your paid-up capital should not be more than fifty lakh rupees at any point of time or your average turnover for the preceding three years should not be more than Two Crores.
A few considerations are necessarily needs to be made before you go ahead with the plan of starting a One Person Company. Ensure that you are ready with the decisions of the following points:
- 1 ID Proof (PAN Card, Aadhar Card, Voter ID Card, Passport)
- 1 Address Proof (Aadhar Card, Voter ID Card, Passport)
- 1 Photo in softcopy
- 1 Specimen signature in soft copy
- 1 Utility Bill (Bank Statement, Mobile Bill, Electricity bill not older than 2 months)
- NOC from the owner of property
- Electricity or Water bill not older than 2 months
- Rent Agreement
Apply for Digital Signature of the Directors.
Apply for the Name Reservation of OPC
Upload forms of Incorporation like e-MOA, e-AOA and INC 32 on ROC portal.
ROC will issue the certificate of Incorporation.
Apply for PAN, TAN and open current account.
The role of nominee starts only with the death of member. The nominee takes over the business upon the death of the member
Yes, you can do but only after two years from the date of formation of a one-person company.
Either your paid up capital should be more than 50 lakh rupees or your aggregate turnover for the preceding 3 years should be over 2 Crores.
No, there's no minimum Capital requirement to start an OPC.
You cannot convert an OPC into a private limited company until it’s two years old. Also, you cannot raise investor money in the One Person Company and cannot issue ESOPs in One Person Company.
No, at a given time, a person can be a member of One Person Company.
The procedure is same as that in a private limited company. You have to appoint a statutory auditor to do your annual audit.
No physical presence is required for the formation of one-person company. You just have to provide the scanned signed documents.
Yes, both can be the same person.
No, an investor cannot invest in OPC because it is the one person company in nature and therefore we cannot issue shares to the investor.
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