Business Registration

Registering a One-Person Company (OPC) is favoured among entrepreneurs who desire limited liability and a distinct legal identity. OPC is a unique business structure that permits a single person to function as a company, giving them the benefits of limited liability while retaining complete control. In an OPC, the individual serves as both the director and shareholder, merging the advantages of a sole proprietorship with the legal protection of a private limited company.

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One-Person Company (OPC) Registration

At FinHub Advisors Pvt Ltd, we specialize in simplifying the OPC registration process, ensuring that entrepreneurs can smoothly navigate the complexities of legal formalities. Our experienced team is dedicated to assisting you at every step, from document preparation to filing, we offer expert guidance to help you make informed decisions regarding your OPC setup.

Contact us now and take the first step toward building your entrepreneurial dream!

Introduction to One Person Company (OPC)

The One Person Company (OPC) revolutionizes solo entrepreneurship, combining the benefits of limited liability with a single ownership structure. In OPC, a single individual can establish a distinct legal entity, shielding personal assets from business liabilities. This innovation encourages entrepreneurs to embark on solo ventures with confidence, attracting those who wish to operate independently while enjoying the perks of a corporate structure. With minimal compliance requirements and reduced complexity, OPCs offer a pragmatic solution for sole proprietors seeking legal recognition and limited liability, fostering a conducive environment for solo entrepreneurs in the dynamic business landscape.

Eligibility Criteria

To be eligible to register as a One Person Company (OPC) in India, an individual must adhere to specific criteria outlined by the Ministry of Corporate Affairs. The Companies Act sets out clear requirements that must be met to ensure that the individual promoting the OPC is eligible to do so.

• Single Owner: An OPC can have only one individual as its member/shareholder. This individual must be an Indian citizen and resident.
• Nominee Designation: The sole member of the OPC must nominate another individual as a nominee who will become the member in case of the original member’s death or incapacity.
• Directorship: The sole member can also be the sole director of the OPC. However, there can be a maximum of 15 directors.
• Residency: The sole member and nominee must be residents of India.
• Not Eligible for Certain Businesses: OPCs engaged in non-banking financial investment activities cannot incorporate companies that would require mandatory non-resident shareholders.
• Annual Turnover and Capital Limit: The turnover of the OPC should not exceed Rs. 2 crore (approximately) in any financial year. Additionally, the paid-up share capital cannot exceed Rs. 50 lakhs.

It’s worth noting that an individual can establish only one OPC, and an OPC cannot have a minor as its member.

Advantages of One-Person Company

• Limited Liability: OPC offers limited liability, safeguarding the personal assets of the sole owner from business debts and liabilities. This ensures that the financial risk is confined to the investment made in the company.
• Single Ownership: OPC allows a single individual to own and operate a company, providing full control and decision-making authority. This structure is particularly beneficial for entrepreneurs who prefer autonomy in managing their business.
• Separate Legal Entity: An OPC is considered a separate legal entity distinct from its owner. This legal recognition enhances the credibility of the business and facilitates better access to funding, contracts, and opportunities.
• Ease of Compliance: OPCs have simplified compliance requirements compared to other corporate structures. Annual filings and regulatory obligations are more straightforward, making it easier for entrepreneurs to manage legal and administrative aspects.
• Nominee for Continuity: The requirement to appoint a nominee in an OPC ensures business continuity in the event of the owner’s death or incapacity. The nominee takes over ownership, providing a smooth transition and avoiding disruption to operations.

Disadvantages of One-Person Company

• Limited Capital Infusion: OPCs may face challenges in raising capital compared to other business structures. The involvement of a single owner may restrict the ability to attract external investment, potentially limiting business growth.
• Nominee’s Role: While the nominee is designated for business continuity, not everyone may be comfortable with another person taking over the ownership in case of the original owner’s demise. This can lead to complexities and potential conflicts.
• Sole Decision-Maker: The single ownership structure means that decision-making authority lies entirely with the owner. While this provides autonomy, it can also result in a lack of diverse perspectives and ideas that may benefit the business.
• Limited Scope for Expansion: OPCs may find it challenging to expand beyond a certain scale due to the constraints of being a single-member entity. Partnerships and private limited companies often have more flexibility in terms of scalability.
• More Stringent Compliance: While OPCs have simplified compliance compared to other corporate structures, they still have more stringent requirements compared to sole proprietorships. The owner must adhere to annual filing and regulatory obligations, and any non-compliance can lead to penalties.

Registration of One Person Company (OPC) in India

In India, the registration of a One Person Company (OPC) is facilitated through the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form, which has replaced the previous application forms for company incorporation.

The registration process for an OPC consists of two parts:

• Part A: This initial section of the SPICe+ form is dedicated to securing approval for the desired company name.
• Part B: The subsequent segment, known as Part B, involves furnishing incorporation-related details. Here, essential information such as the registered office address of the OPC, details about share capital, particulars of the director, and information about the shareholder is provided.

Here are the steps involved in the OPC registration.

Step1: Obtain Digital Signature Certificate (DSC) and Director Identification Number (DIN)

The first step is to obtain a Digital Signature Certificate (DSC) for the proposed director. Additionally, the director must obtain a Director Identification Number (DIN) from the Ministry of Corporate Affairs (MCA).

Step 2: Name Reservation

Choose a unique name for the OPC and check its availability. Once finalized, apply for a name reservation through the MCA’s online portal.

Step 3: Drafting the Memorandum of Association (MOA) and Articles of Association (AOA)

Prepare the Memorandum of Association (MOA) and Articles of Association (AOA) for the OPC. These documents define the company’s objectives, rules, and internal regulations.

Step 4: Filing Documents with the Registrar of Companies (RoC)

Complete the registration process by submitting the necessary documents, including the MOA, AOA, and other required forms, to the RoC through the MCA portal.

Step 5: Payment of Fees

Pay the requisite fees for registration and stamp duty through the MCA portal. The fee amount depends on the authorized capital of the OPC.

Step 6: Certificate of Incorporation

Once the RoC verifies the documents and approves the application, a Certificate of Incorporation will be issued. This certificate officially establishes the OPC as a legal entity.

Step 7: Bank Account and Business Commencement

Open a bank account in the name of the OPC using the Certificate of Incorporation and other relevant documents. The business can commence operations once all formalities are complete.

Why FinHub Advisors Pvt Ltd for OPC Registration?

Choose FinHub Advisors Pvt Ltd for seamless One Person Company (OPC) registration in India. Our expert professionals simplify the process, ensuring compliance with all legal requirements. With precision in documentation, timely submissions, and personalized guidance, FinHub Advisors Pvt Ltd accelerates your journey from application to obtaining the Certificate of Incorporation, making OPC registration hassle-free and efficient.

Documents Required For OPC Registration?

• PAN Card of the Director/Shareholder/Nominee
• Electricity Bill of the premises
• Aadhar Card of the Director/Shareholder/Nominee
• Bank Statement of the Director/Shareholder/Nominee
• Lease/ Rent Agreement
• MOA Subscriber Sheet
• AOA Subscriber Sheet
• Passport Size Photo of the Director/Shareholder/Nominee