One Person Company

A One Person Company is a type of Private Limited Company which has single ownership unlike a Private company which requires at least two members. This business structure was introduced in the Companies Act, 2013. A One Person Company has a single shareholder who is the owner of 100% stake in the company. However, it is compulsory to appoint a nominee to maintain the character of perpetuity. This nominee will take the place of the owner in case of death or disability. Registration provides a corporate status and many other benefits to the members and directors like having a separate legal entity while safeguarding the personal assets of the sole owner from business liabilities. OPC must be converted to a Private Limited Company when paid-up share capital exceeds Rs.50 lakhs or turnover crosses Rs.2 crores.

Advantages of One Person Company Registration

Separate Legal Entity

One Person Company is recognized as a separate legal entity with perpetual existence. It can have a PAN number, bank accounts, licenses, approvals, contracts, assets and liabilities in its unique name.

Limited Liability

One Person Company provides limited liability protection to its shareholder. In case of any unforeseen liabilities, it would be limited to the company and not impact the personal assets of the shareholder.

Funding

A company can raise equity capital from persons or entities interested in becoming a shareholder. Entrepreneurs can raise money from angel investors, venture capital firms, private equity firms and hedge funds.

Easier Compliance

One Person Company has easier compliance than many other structures. For ex - An OPC is exempt from holding an annual general meeting or extraordinary general meetings. The resolution signed by the single Director and entered into the minutes book is considered sufficient.

Pricing

All Inclusive Pricing - No Hidden Fee

Starter

₹6749
5,749*
  • All expenses and Government fee
  • 1 Digital Signatures (DSC)
  • 1 Director Identification Numbers (DIN)
  • 1 Name Approval Application
  • Certificate of Incorporation
  • PAN Number
  • TAN Number
  • Company Identification Number
  • MOA and AOA Drafting
  • DSC and DIN for additional partners at extra cost

Business

₹9749
8,749*
  • Everything in Starter Package, +
  • 1 Additional Name Approval application
  • GST Registration Application
  • MSME Registration
  • Form for Commencement of Business
  • First Auditor Appointment Resolution
  • Draft of Bank Account Opening Resolution
  • Draft of Employment offer letter
  • Draft of Employment Contract
  • Draft of Website Disclaimer Policy
  • Draft of NDA
  • DSC and DIN for additional partners at extra cost
Bestseller

Premium

₹25749
24,749*
  • Everything in Business Package, +
  • Annual form filing with MCA for 1st year
  • Form for appointment of auditor
  • GST return (up to 100 invoices per month) for 12 months
  • ITR filing for 1st year
  • DSC and DIN for additional partners at extra cost

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Things to Know before Registering One Person Company

Who Can Incorporate an OPC?

Only a natural person who is an Indian Citizen, Adult and an Indian Resident can incorporate OPC. A person can incorporate not more than one OPC.

Who Can Not Incorporate an OPC?

Businesses involved in financial activities cannot be incorporated as a OPC. Legal entities like Company or LLP cannot incorporate a OPC. An OPC is prohibited from having a minor as its member.

What does Indian Resident refer to?

Indian Resident means a person who had resided in India for a period not lesser than 182 days in the prior calendar year.

What is the role of Nominee in One Person Company?​

A nominee must be appointed by the owner during incorporation to maintain the character of perpetuity. They will take the place of the owner in case of death or disability.

What is the Minimum Authorized Capital for OPC?

Authorized capital is the maximum amount of the capital for which shares can be issued by the Company to its shareholders. The minimum authorized capital for an OPC is ₹1,00,000.

How can I convert an OPC to Private Limited Company?

OPC must be converted to a private limited company when paid-up share capital exceeds ₹50 lakhs or turnover crosses ₹2 crores.

Documents required to register a One Person Company

PAN Card

PAN Card of Sole Owner & Nominee.

Identity Proof

Aadhar card/Passport/Driving License/Voter ID of Sole Owner.

Address Proof

Latest(No Less than 3 months old) Telephone Bill /Electricity Bill/ Bank Account Statement of Director.

Photograph

Latest Passport size photograph of Sole Owner and Nominee.

Business Address Proof

Latest Electricity Bill/Telephone Bill of the registered office address.

Rent Agreement

Rent Agreement of the registered office should be provided if any

NOC from Owner

No Objection Certificate to be obtained from the owner(s) of registered office

Attestation by Gazetted Officer

Documents of director(s) must be attested by a gazetted officer.

4 Easy Steps to Register a One Person Company

Step 1: Obtaining Digital Signature​
Digital signature certificate(DSC) must be obtained for the sole promoter and the nominee for processing the incorporation. Application for DSC would require passport size photos of the applicant, identity proof and address proof.
Step 2: Obtaining Name Approval
In parallel to the Digital Signature application, the application for name reservation can be submitted to the MCA. Name approval applications are processed by the MCA in 24-72 hours. The name suggested must conform to the naming standards, and the name of the OPC must end or include the words (OPC).
Step 3: Incorporation
After obtaining name approval, incorporation application can be filed to the MCA with signed Memorandum of Association (MOA) and Articles of Association (AOA). Further, the identity proof, address proof and residence proof of the member and nominee would be required. In addition to the MOA, AOA, identity proof, address proof, other incorporation documents like affidavits and declaration of the sole promoter must be submitted. Further, the consent of the nominee director must also be attached in Form INC-3. On filing for incorporation, approval is granted by the Registrar of Companies (ROC). In case there are any issues with the documents submitted, the application for incorporation can be resubmitted.
Step 4: Commencement of Business
Once the incorporation certificate is obtained, the OPC would initiate the process for bank account opening. Once the bank account is opened, the promoter must deposit the amount mentioned in the MOA of the Company. After the equity capital is infused into the Bank's current account; the Company can file for the commencement of business with the MCA. Commencement of Business Certificate must be obtained with 180 days of incorporation to avoid a penalty. In case notice of the situation related to registered office was not filed during incorporation, it must be filed after incorporation within 30 days.
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How to Create a Company Name

Unique Name

A Unique Name builds the company brand. This should preferably be a coined word.

Business Objective​

The second part of the name should suggest the business activity of the company

Constitution Type​

Name of the company must end with “Private Limited (OPC)” as a suffix

Frequently Asked Questions about One Person Company

To incorporate a One Person Company, a Director and a nominee is required. A nominee member is one, who shall, in the event of promoter member`s death or incapacitation become a member of the Company.

Authorized capital of a Company is the amount of shares a company can issue to it shareholders. Companies have to pay the Government an authorized capital fee to issue shares in a Company. Companies have to pay authorized capital fee for a minimum of Rs.1 lakh.

Only a natural person who is an Indian citizen and a resident in India is eligible to incorporate a One Person Company or be a nominee member. The Director or Nominee must also be over 18 years of age.

Once a Company is incorporated, it will be active and in-existence as long as the annual compliances are met with regularly. In case, annual compliances are not complied with, the Company will become a Dormant Company and maybe struck off from the register after a period of time. A struck-off Company can be revived for a period of upto 20 years.

A Digital Signature establishes the identity of the sender or signee electronically while filing documents through the Internet. The Ministry of Corporate Affairs (MCA) mandates that the Directors sign some of the application documents using their Digital Signature. Hence, a Digital Signature is required for all Directors of a proposed Company.

Director Identification Number is a unique identification number assigned to all existing and proposed Directors of a Company. It is mandatory for all present or proposed Directors to have a Director Identification Number. Director Identification Number never expires and a person can have only one Director Identification Number.

An address in India where the registered office of the One Person Company will be situated is required. The premises can be a commercial / industrial / residential where communication from the MCA will be received.

One Person Company can be started with any amount of capital. However, fee must be paid to the Government for issuing a minimum of shares worth ₹1 lakh (Authorized Capital Fee) during the incorporation of the OPC. There is no requirement to show proof of capital invested during the incorporation process.

No, you will not have to be present at our office or appear at any office for the incorporation of a One Person Company. All the documents can be scanned and sent through email to our office. Some documents will also have to be couriered to our office.

Identity proof and address proof is mandatory for all the proposed Director and Nominee of the One Person Company. PAN Card is mandatory. In addition, the landlord of the registered office premises must provide a No Objection Certificate for having the registered office in his/her premises and must submit his/her identity proof and address proof.

Lawbuddy can incorporate a One Person Company in 7-15 days. The time taken for incorporation will depend on submission of relevant documents by the client and speed of Government Approvals. To ensure speedy incorporation, please choose a unique name for your Company and ensure you have all the required documents prior to starting the incorporation process.

To incorporate a One Person Company quickly, make sure the proposed name of the Company is very unique. Names that are similar to an existing company / limited liability partnership / trademark can be rejected and additional time will be required for resubmission of names.

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Comparison Between Various Business Structures

Act

Companies Act, 2013

Companies Act, 2013

Limited Liability Partnership Act, 2008

Indian Partnership Act, 1932

No specified Act

Registration Requirement

Registration under Companies Act is mandatory

Registration under Companies Act is mandatory

Registration under LLP Act is mandatory

Unregistered partnerships are legal, but registered entity enjoys certain advantages

There is no registration criteria prescribed. But, registration is recommended

Number of members

Minimum 2 and not more than 200 shareholders

Only an individual,and an Indian resident can be the shareholder

No bar on maximum number of partners, but minimum 2 Designated Partners are required

It is formed with minimum 2 partners, but not exceeding 50

Proprietor is the only owner of the firm

Separate Legal Entity

Yes. It is a separate entity and can own assets in its name.

Yes. It is a separate entity and can own assets in its name.

Yes. It is a separate entity and can own assets in its name.

No. It does not have any separate identity from its partners 

No.  Proprietor and business are considered the same

Liability Protection

Limited up to the total value of shares subscribed

Limited up to the total value of shares subscribed

Limited up to the capital amount agreed to introduce

Partners are jointly and severally liable to pay the debts of the Partnership Firm

Proprietor’s liability is to pay-off all the debts and obligation of the firm

Statutory Audit

Auditor must be appointed within the 30 days of incorporation

Auditor must be appointed within the 30 days of incorporation

Applicable when turnover exceeds INR 40 Lakh or contribution exceeds INR 25 Lakh

Statutory audit not applicable. Tax audit may be applicable based on turnover

Statutory audit not applicable. Tax audit may be applicable based on turnover

Ownership Transferability

Shares can be transferred with the consent of other Shareholders

Shares are not easily  transferable 

Ownership can be changed with consent of other partners

Ownership is not transferable easily, clause of partnership deed should be referred

Firm is no different from proprietor and so ownership is not transferable

Uninterrupted Existence

Yes. Perpetual existence as the management and owners are different. Ownership is easily transferable

Yes. The nominee will take place of member.

Change in Partners or Designated Partners does not affect the existence of LLP

Change in partner leads to dissolution or formation of another partnership firm

Death or insolvency of proprietor directly affects the firm

Foreign Participation

Foreign national are allowed to invest under the Automatic Route

Member, nominee and director must be an Indian resident

Foreign nationals are allowed, subject to FDI Guidelines

Foreign nationals are not allowed to be a partner

Foreign Nationals cannot commence proprietorship business

Tax Rates

Moderate. Tax rate applicable for small companies is reduced to 22%, dividend distribution tax applicable

Moderate. Tax rate applicable for small companies is reduced to 22%, dividend distribution tax applicable

High. With tax rate of 30% on business profit, no tax on income distribution to partners

High. With tax rate of 30% on business profit, no tax on income distribution to partners

Low. Tax rates of individual applied to Proprietorship Firm

Statutory Compliances

High. Companies have to meet high compliance requirements 

High. Companies have to meet high compliance requirements 

Moderate. Lesser compliance requirements compared to companies

Low. Separate ITR of partnership is filed, else there is no filing requirement

Low. No compliances and no requirement to file a separate ITR