Expert Tips for Successful OPC Registration - 24efiling

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• The Companies Act of 2013 provides and guarantees
  the formation of One Person Company (OPC) in
  India. It deals with the registration and
  functioning of One Person Company in India. While
  comparing OPC with the private company, here at
  least a minimum of 2 single members and 2
  directors are required. However, in OPC is quite
  enough to register and form a company with one
  member and one director. This is the significant
  difference between OPC and others. Section 2(62)
  of the Companys Act 2013, provides the official
  registration of one Person Company and it is
  completely legal. In India, One one-person
  company
• Registration requires one single member who
  represents and manages
• the whole firm along with a single director. This
  type of company requires fewer requirements
  compared to the private company. The One Person
  Company emerged with the objective of developing
  a sole proprietorship firm. It is one of the
  types of private limited companies. Any
  individual can register and form One Person
  Company, but to start operating the registration
  is mandatory.
• TABLE OF CONTENTS
• WHAT IS THE PROCESS OF OPC Registration?
• WHO ARE ELIGIBLE FOR OPC REGISTRATION?
• WHAT ARE THE BENEFITS FOR REGISTERING ONE PERSON
  COMPANY?
• WHAT IS THE TOTAL COST OF REGISTERING OPC IN
  INDIA?
• TAXATION OF OPC
• DISADVANTAGES OF OPC
• FAQs

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• CONCLUSION
• WHAT IS THE PROCESS OF OPC REGISTRATION?
• Now, it is well clear to us what is OPC and who
  is eligible.?
• Here are certain conditions that must be
  fulfilled in order to be eligible for the
  registration of OPC. If in case, the subscriber
  is dead, the nominee of that subscriber enters
  and works as a single member of the company.
• Here is the step-by-step registration process for
  OPC (One Person Company)
• Step 1  Firstly, one should apply for the DSC
  (Digital Signature Certificate) of the proposed
  director.
• Step 2  Secondly, the Member of the OPC must
  apply for the DIN (Director Identification
  Number) of the proposed director.
• Step 3  Next, it should be opted for name
  approval. The Members of OPC should apply for
  the name reservation in MCA (Ministry of
  Corporate Affairs). They should apply with one
  name on the SPICe (INC-32) application form.
• Step 4 - At this stage, the member of OPC, after
  completing the above steps he/she has to
  accumulate or submit all the essential documents
  and should attach all these documents to the
  SPICe Form, SPICe-AOA, SPICe- MOA and upload
  them to the MCA site for approval.
• Download SPICe-AoA
• Step 5 - After completing the verification of the
  documents that are submitted, the ROC (Registers
  of Company) will provide or issue an
  Incorporation Certificate which will enable the
  member of OPC to initiate
• and run the company.

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• WHO ARE ELIGIBLE FOR OPC REGISTRATION?
• A natural person who is a resident of India can
  form OPC.
• Unlike the other type of company, only one member
  can form an OPC.
• The name that has been created should be unique
  and it
• should not be similar to any other company and
  trademark which is already in existence.
• An individual cannot have and operate more than
  one OPC.
• There must be at least one director in the OPC
  along with the member.
• ?
• WHAT ARE THE BENEFITS FOR REGISTERING ONE PERSON
  COMPANY?
• As it is well known, OPC can be formed with one
  Director and a member. It provides great
  benefits for registering and entering into a
  one-person company. Here are the benefits of
  registering a one-person company.
• Easy Incorporation 
• In a One Person Company, a single person can
  start a business with very few requirements. The
  incorporation of the OPC requires only one
  member and one director. The paid-up capital is
  not required for its incorporation.  so, by
  this, its very clear that the One Person Company
  is easy to incorporate.
• Complete Control by the Individual

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• As it is a single-person company, complete
  control is vested in the hands of a single
  person. In which the decision-making becomes easy
  and quick as there will be no different and
  conflicting opinions, the running, functioning
  and management of the Company will be quite easy.
• Easy Compliance and Tax Flexibility
• The Companies Act 2013 provides lesser compliance
  to One Person Company. Less compliance means
  less paperwork, which results in the usage of
  less time to carry out such lesser compliance.
  The OPC has no need to show the cash flow and
  avails the benefit of tax availability too. The
  Director has to maintain the accounts book and
  submit the annual returns. 
• Benefits for Small-Scale Industries
• One Person Company avails the benefits that are
  provided to small-scale industries for example
  easy funding, less compliance, loans at a lower
  interest rate, etc It is a great beneficial thing
  to the OPC to run the company.
• Ease in Funding 
• One of the significant benefits is that OPC can
  take its funds through various opportunities
  like capital ventures, financial institutions and
  other investors. The fund is necessary to
  operate and improve the business of the company.
  In order to bring up its funds from outside, the
  OPC can change or upgrade itself into a private
  company. 
• Least requirements for Registration 
• When it comes to the one-person company, the
  process of registration is simple and the
  requirements which are needed are very less when
  it is compared with the registration of other
  types of companies.

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• Greater Credibility 
• It is well known that the OPC consists of a
  single member and single director, the member
  controls the whole firm, resulting in its
  accounts being audited and maintained annually,
  and thus ultimately it has greater credibility.
• Significant Growth
• In the introduction, we saw that the One Person
  Company is based on the sole ownership of the
  Company and it is a Centralised Management
  System which pushes the Company towards achieving
  significant growth and a great contribution to
  our countrys economy.  
• Income Tax Benefits 
• In order to avail the benefits from income tax
  which is at least for 5 years, must register in
  the start-up India scheme of the government. For
  that, the one-person company must be unique when
  compared to others and should provide a greater
  level of employment.
• Sole Business Ownership 
• The one-person company is handled by one member
  and one director. Sole ownership provides
  stability in the business as there will be no
  chance of conflict of interest or opinions among
  the shareholder group because only one member is
  running the whole business in a one-person
  company.
• Increased Transparency

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Another significant benefit of the One Person
Company is increased transparency while dealing
and managing with government authorities. The
transparency can be seen both in the Government
and the applicant.   12. Beneficial to sectors
like MSME and SME The one-person company is quite
beneficial to the sectors like MSME AND SME. The
MSME sector stands for the Ministry of Micro and
SME stands for Small and Medium Enterprises. The
business in rural areas can be enhanced through
the services of OPC. The one-person company can
bring a good reputation and growth to the MSME
and SME sectors. Also read related articles Is
GST Mandatory for OPC? WHAT IS THE TOTAL COST
OF REGISTERING OPC IN INDIA? The nominal share
capital determines the government fees that are
required to register the OPC in India. For
instance, if the Share Capital of the OPC is 10,
00,000, then the Government fees for registering
an OPC would be 2,000/- Rs. If the nominal share
capital is between Rs. 10, 00,000.00 to Rs. 50,
00,000. Rs. 2,000. Rs. 200 will be added to
each Rs. 10,000 shares. However, there are also
some additional fees that would apply for the
OPC incorporation in India for example stamp
duties, form filing fees and DIN form
fees. TAXATION OF OPC As it is well known that
one person company is carried out by one person.
Its quite similar to a private Limited company.
OPC is not recognized and not discussed in the
Income Tax Act 1961. When it comes to compliance
with tax One person company is similar to a
Private Limited Company. Hence like private
limited companies, OPC also needs to file income
tax returns. The OPC has to file the ITR even if
there is no profit or transaction. The Income
Tax Rate for One Person company is
25. DISADVANTAGES OF OPC 1. Suitable for only
small businesses OPC is suitable only for small
business structures. It is very clear that OPC
can have one member and one director, so it
cannot be expanded by adding more shareholders
or members. This is one of the major drawbacks.
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• Restriction of Business Activities 
• Another drawback is that the OPC cannot take up
  with Non-Banking Financial Investment
  activities, and it cannot be converted to a
  company that deals with charitable objects as
  mentioned under Section 8 of the Companies Act,
  2013.
• Ownership and Management
• Sometimes there can be misuse of power which can
  lead to unethical business practices because in
  One Person Company, there is only one director
  and member, and all the decisions are made by a
  single person, if the decision-making powers.

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• FAQS
• WHAT IS AN OPC UNDER THE COMPANIES ACT 2013?
• An OPC is a specific kind of corporate entity
  that enables a lone person to run and control
  the firm. It was first created in India to give
  business owners a platform to launch a company
  with the advantages of limited liability.
• WHO IS ELIGIBLE TO BE A MEMBER OF AN OPC?
• To serve as a member and nominee of an OPC, a
  natural person must be an Indian citizen and
  resident of India. For the aforementioned
  purposes, a person is considered to be a
  resident of India if they have spent at least
  102 days there in the financial year that just
  ended.

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• CAN A PERSON BE A MEMBER OF MORE THAN ONE OPC?
• No, a person can be a member of only one OPC. He
  or she cannot be a member of more than one OPC
  as mentioned under the Companies Act 2013.
• IS THERE ANY TAX ADVANTAGE TO FORMING AN OPC?
• An OPC does not have a unique tax benefit over
  any other type of company. The tax rate is a
  flat 30 however, all other tax laws, including
  MAT and Dividend Distribution Tax (DDT), are
  still in effect.
• IS THERE ANY THRESHOLD LIMITS FOR AN OPC TO
  MANDATORILY GET CONVERTED INTO EITHER A PRIVATE
  OR PUBLIC COMPANY?
• No, the Companies (Incorporation) Second
  Amendment Rules, 2021 eliminated the requirement
  for OPC conversion upon exceeding the minimum
  paid-up capital and average annual turnover.
  Because of this, an OPC does not now have to
  change its status to a private or public company
  when its paid-up capital and average annual
  revenue increase.
• WHAT IS THE MANDATORY COMPLIANCE THAT AN OPC
  NEEDS TO OBSERVE?
• The minimum requirements include holding at least
  one board meeting in each half of the year and
  requiring a minimum of 90 days to pass between
  meetings.
• Keeping accurate books of accounts.
• Audit of financial statements as required by law.
• Submitting business Income Tax Returns by
  September 30th each year.
• Financial Statements on Form AOC-4 and ROC Annual
  Return on Form MGT 7 have to be submitted.
• WHO CANNOT FORM AN OPC?
• No one under the age of 18, a resident of another
  country, a non-resident, or someone who is
  physically or mentally disabled under a contract
  may join.

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• private limited company. To convert OPC into a
  private limited company, creditors must provide
  a No Objection Certificate (NOC) in writing.
• WHAT IS THE DIFFERENCE BETWEEN AN OPC AND A SOLE
  PROPRIETORSHIP?
• One Person Company (OPC) It has a single
  shareholder, limited liability, and no minimum
  requirement for the number of directors that must
  be appointed.
• Private Limited Company (Pvt Ltd) It offers
  limited liability and the capacity to raise
  money through the issuance of shares, but it also
  requires a minimum of two shareholders and two
  directors.
• HOW MANY DIRECTORS CAN AN OPC HAVE?
• OPC can have directors, but there must always be
  at least one of them. By default, the only
  shareholder also serves as the director.
• Talk to our expert for OPC Registration
• CONCLUSION
• Hence, the one-person company is operated by one
  member and one director. The OPC registration
  covers the member with limited liability
  protection therefore, if in case of any loss of
  the company, the member will not be liable for
  it. The incorporation process in OPC is quite
  easy. Earlier, it was like starting a company
  there must be more than one person either in a
  private company or public company but this has
  changed after the enforcement of the Company Act
  2013.