One Person Company Registration in India

One Person Company registration in India was introduced via Companies Act, 2013 to promote self-employment by encouraging individuals who are capable of starting a business on their own. Aiding those entrepreneurs who want to exercise total control over their entity while enjoying limited liability, it eliminates the need for two directors as in a private limited company. The applicant is the sole director as well as shareholder of his company. It does need one nominee though, mentioned in the Memorandum & Articles of Association who can take over the company’s responsibility in case the original member is rendered dead or incapable by any cause.

A natural citizen and national of India not involved either as a member or nominee of any other such concern can apply for OPC registration in India. A minimum authorised capital of Rs 1 lakh can be used to start an OPC while there is no specified minimum amount for paid up capital. The maximum paid up share capital and an average 3-year turnover cannot exceed Rs 50,000 and Rs 2 crore respectively and if so happens, the OPC must be converted into a private limited company. There are no tax advantages for such entities with a flat 30% rate. Like any other company it has to maintain account books and file business income tax every year besides statutory auditing of financial statements.

  • One cannot take investments
  • No legal existence
  • Unlimited liabilities,
  • Proprietorship is considered as untrustworthy in India.

One Person Company has some features and restrictions:-

  • Separation of ownership and operations up to a great extent,
  • Less compliance is required compared with a private limited company,
  • Small entrepreneurs can make an entry in the market,
  • Financial institutions and banks prefer lending money to the company in place of proprietary firms,
  • Faster decision making on account of single ownership and
  • The owner of change the business venture in a private limited company any time without any problem.

Documents Required

The documents required by the applicant while requesting for OPC Registration are listed below

Director/ Shareholder/ Nominee

Identity Proof
-Permanent Account Number (PAN),
-Aadhar Card, Passport, Voter Identity Card, Driving License

Address proof
-Fixed Line Telephone Bill/ Mobile Bill
-Electricity Bill/ Water Bill/ Piped Natural Gas Bill
-Bank Statement/ Bank Passbook

Note : All the copies of the above mentioned documents have to be scanned with the director self-attesting them. All the utility bills namely- telephone, mobile, electricity,water and gas and the bank statement should not be more than two months old.

A scanned copy of passport size photograph of the applicant is also needed for the purpose.

Registered Office

The official premises of the business can be self-owned or a rented property. Scanned copies of the following documents are required as proof of a registered office :

Self-owned Property
Address Proof
-Fixed Line Telephone Bill/ Electricity Bill/ Piped Gas Bill/ Water Bill
-Registered Sale Deed

Rented Property
Address Proof
-Fixed Line Telephone Bill/ Electricity Bill/ Piped Gas Bill/ Water Bill
Note : The utility bills should be in the name of the owner of the property and not more than two months old.
-Notarised Rent Agreement
-No objection Letter from the owner of the property authorising the applicant to use the premises as the registered office of the business

Advantages & Benefits

Limited Liability

The financial liability of a shareholder of any privately owned business is limited to the amount of investment made in the company by him/her. This privilege makes OPC registration in India an appealing option for any new businessman.

Perpetual Succession

The investment made in a business does not go waste if the original owner is rendered unfit to discharge his duties due to death or any other eventuality as the provision of designating a nominee will give the control to the person named in the OPC’s Memorandum and Articles of Association.

Less Compliance

The structure of the company makes it very easy to manage and the compliances required to be submitted with the Registrar of Companies are also comparatively less than a Private Limited Company. While still needing to submit annual Balance Sheet, account of profit and loss to the Registrar of Companies and Tax Returns to the Income Tax Department, it is not required to hold the Annual General Meeting as the sole director can simply add the resolution in a minutes book and sign it.

Easy Funding

Banking and Financial Institutions generally give preference to companies over proprietary firms. The legal status of an OPC makes it convenient for the owner to approach not only banks but also a variety of other sources like Venture Capitalists and Angel Investors.

Total Control

The most attractive feature which makes most of the businessperson opt for one person company registration as one gets to exercise complete authority over decision-making and implementation while the firm has been incorporated as a company.

Frequently Asked Questions

IS ONE PERSON COMPANY IS A PRIVATE LIMITED COMPANY?

Yes, One Person Company will be formed as similar as a “Private Limited Company”. It can be formed as company limited by share capital or limited by guarantee or unlimited company. The words “One Person Company” will have to be mentioned in brackets below the name of such company, wherever its name is printed, engraved or affixed.

IS ONE PERSON COMPANY REQUIRED TO FOLLOW LESS COMPLIANCES THAN A PRIVATE LIMITED COMPANY?

OPC is one of the easiest forms of corporate entities to manage. Very few ROC filing is to be filed with the Registrar of Companies (ROC). No need to conduct Annual General Meeting (AGM), so lesser compliance cost than a private limited company.

WHO CAN INCORPORATE A ONE PERSON COMPANY?

Only a person, who is an Indian citizen and resident in India, shall be eligible to incorporate a One Person Company. For becoming a director in a company, no professional or educational qualification is required. Any individual can become a shareholder in a one person company.

HOW MANY ONE PERSON COMPANY A PERSON CAN INCORPORATE?

A person can incorporate upto five One Person Companies.

DO PROMOTERS HAVE TO BE PRESENT PERSONALLY TO INCORPORATE A COMPANY?

Yes, promoters need to be present to personally meet us at our office or meet at any place for the registration of a Company. All the incorporation documents required to be present in original and scanned copy also required to submit.

HOW MUCH TIME WILL IT TAKES TO INCORPORATE A ONE PERSON COMPANY?

To incorporate a company we required approximately 5 to 8 working days. The time taken for incorporation will depend on submission of relevant documents by the client and speed of Government Approvals. To ensure speedy process of incorporation, please choose a unique name for your Company and ensure you have all the required documents are provided before starting the incorporation process.