Article Discusses Meaning of One Person Company (OPC), Benefits of OPC over sole proprietorship, Maximum Time Taken to incorporate OPC, Documents Required to incorporate OPC, Minimum Person Required to form an OPC, Restriction for running the OPC and Steps involved in OPC Formation in brief.
| Meaning | Revolutionary new concept of “one man army” introduced under the Companies Act, 2013.
One Director: One Shareholder concept |
| Benefits over sole proprietorship |
1. No need of profit sharing. Profit will belong to only you. 2. Minimum compliances and paper work 3. Convertible to other form of business if required (not before 2 years voluntarily except exceeds capital/turnover limit) 4. Corporate form of sole proprietorship 5. Separate legal entity & limited liability 6. Ease of procuring finance-credit record of OPC considered.(prudentadviso@gmail.com) 7. Risks mitigated are limited to the extent of the value of shares held by such person in the company; enabling entrepreneurial minded persons to take the risks of doing business without the botheration of litigations and liabilities getting attached to the personal assets. |
| Maximum Time Taken to incorporate OPC | 15 Days depending upon processing of documents |
| Documents Required |
1. KYC of member (PAN, ADHAR/passport, Photo) 2. Utility bill of proposed registered office address of OPC 3. In case of rented premises, NOC from landlord and rent agreement |
| Minimum Person Required: | 1 |
| Process | Proposed Name of OPC, Decide Share Capital.
1. Obtain DSC, DIN 2. Name availability 3. Nominee to the person for becoming owner of the company after the existing person and the nominee consent form 4. MOA & AOA 5. Filing incorporation 6. COI |
| Restriction for running the OPC | 1. Cap of 50 lacs on paid up share capital or 2 crores on average annual turnover in three immediate preceeding consecutive years (i.e. mandatory conversion if the aforesaid limit exceeds)
2. Minor not allowed to become member or nominee |
Numerous exemptions available to OPC in the Companies Act 2013. OPC is a boon to small entrepreneurs as they get a corporate identity with least compliance. Want corporate recognition? Get an expert assistance at prudentadviso@gmail.com / 9873564091
Author Bio
A good presentation, easy to note down. Pratap
Well written ..thanks for sharing.