No, an individual can form only one OPC at a time. This rule applies to the nominee in an OPC, too.
The right structure for solo entrepreneurs looking beyond the opportunities a sole proprietorship affords.
There are only 3 simple steps:
APPLY DIN AND DSC
Apply for the DIN and Digital Signature for the Directors which is require for filings e forms for the one person company registration.
SEARCH FOR COMPANY NAME AVAILABILITY
THE NEXT STEP IS TO apply for the Name approval on the MCA Portal according to MCA Guidelines
FILLING OF REGISTRATION DOCUMENTS TO ROC
AFTER THE COMPANY NAME AVAILABILITY, Filings E Forms with ROC and payment of ROC Fees after the Name Approval from Officers.
ONE PERSON COMPANY
(OPC)
One Person Company(OPC) is for those entrepreneurs who want to register their business as company in india but they are only single founder in the company. One Person Company (OPC) is a type of Private Limited Company where minimum and maximum number of members is one. It gives a single promoter full control over the company while limiting his/her liability to contributions to the business. The OPC is one of the most credible structure and preferred over a Proprietorship. So as a Startup when you are sole founder of the company, you want to register as company legal entity then instead of private limited company you can choose OPC and can enjoy all the company features.
DOCUMENTS REQUIRED FOR ONE PERSON COMPANY REGISTRATION
For Sole Director and Nominee
- Self Attested Scan Copy of PAN Card
- Self Attested Scan copy of Identity Proof (Election ID / Aadhar Card / Passport / Driving License)
- Passport Photo
- Address Proof (Latest Bank Statement / Mobile Bill / Telephone / Gas Bill )
For the Registered Office
- Notarised Rent Agreement
- Latest Electricity Bill /Telephone or Mobile Bill/ Gas bill/ Latest Bank
- Statement
- NOC from the property owner
ADVANTAGES OF ONE PERSON COMPANY (OPC)
One Person Company (OPC) Private Limited has numerous advantages when compared with Companies and Proprietorship firm.
Limited Liability
The directors' personal property is always safe in a private limited company, no matter the debts of the business
Minimum compliances:
One Person Company have to face little compliance burden as compared to private limited companies , hence One Person Company can more focus on other functional and core areas.
Continuous Existence
Sole Proprietorships come to an end with the death of the proprietor. As an OPC has a separate legal identity, it would pass on to the nominee director and, therefore, continue to exist.
FAQs ON OPC REGISTRATION
An OPC is a good alternative to running a sole proprietorship, largely because it gives limited liability to the business owner. This means that your liability is limited to the amount you’ve invested in the business; business debts cannot be recovered from personal possessions. Also, a sole proprietorship ceases to exist on the death of its promoter. In the case of an OPC, the nominee director takes over and the entity continues to exist. Single entrepreneurs who do not have another partner to start a private limited company may also consider it.
Only Indian residents can register an OPCs, and that, too, only one at a time, as per the specifications of the Ministry of Corporate Affairs.
All such businesses must maintain books of accounts, comply with statutory audit requirements and submit income tax returns and annual filings with the RoC.
1. Sole proprietorships are the least complex and cheapest form of doing business
2. Sole proprietorships require no formal paperwork to set up and don’t need to be registered with the state
3. Sole proprietorships do not shield individuals from liability for their business debts
4. Sole proprietorships are treated as simple income for tax purposes, and do not need to have separate taxes prepared
There is no difference in capital requirement between an OPC and a private limited company. It needs an authorised capital of Rs. 1 lakh to begin with, but none of this actually needs to be paid-up. This means that you don’t really need to invest any money into the business.
No general advantages; though some industry-specific advantages are available. Tax is to be paid at flat rate of 30% on profits, Dividend Distribution Tax applies, as does Minimum Alternate Tax.
The MCA is skeptical about a single person in charge of a large corporation. Therefore, it requires all OPCs to be converted into private limited or public limited companies on crossing a certain revenue number. Currently, in case of an average turnover of Rs. 2 crore or more for the three consecutive years or a paid-up capital of over Rs. 50 lakh, the OPC must mandatorily be converted into an OPC.
The cost of an OPC is only marginally lower than that of a private limited company. You’ll be shelling out around Rs. 12,000 to incorporate, then paying around Rs. 15,000 a year in compliance fees and an auditor to inspect your books.
An OPC has certain limitations. The person starting the business is its only director and shareholder. There is also a nominee director, but this person has no power whatsoever for raising equity funds or offer employee stock options. The nominee exists only to take over in case of the death or incapacitation of the director. The nominee is chosen by the director, and can be anyone, such as your spouse, parents or siblings. The nominee will need to provide identity proof during registration.