Do you wish to reduce your responsibilities while starting a business on your own? You should apply to form a one-person company, also known as an OPC.
In recent years, the one-person company (OPC) structure has been introduced as a refinement of the sole proprietorship firm structure. A one-person company (OPC) is a business started by just one person. On the other hand, a company must have at least two directors and two members to be formed. For someone who wishes to start a business on their own, an OPC is an ideal option. Before the Companies Act of 2013, a single individual could not form a corporation. Get to know more about directors In OPC.
One Person Company: Unique Feature
In an OPC, a single promoter gets complete control of the firm, limiting his or her accountability to his contributions to the OPC. Therefore, this individual will be the sole shareholder and director (however, a nominee is appointed, but has zero power until the real director proves himself incapable of carrying on). In such business vehicles, there is also no option for employees to contribute to employee stock options or equity investment.
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One Person Company: Incorporation Procedure
Step 1: Contact Vakilsearch to check your eligibility to apply for incorporation and get a list of all the documents you are required to keep handy
Step 3: Then you must proceed to apply for a name reservation for your OPC, this task as well is taken care of on your behalf by our experts
Step 4: Well will then file the Spice+ form for company incorporation
Step 5: Following this, we will help you apply for PAN and TAN for your new company
Step 6: The RoC will then issue a certificate of incorporation for your company
Step 7: We will then assist you in opening a bank account and help you with all post-incorporation procedures.
One Person Company: Conversion
A one-person firm must convert to a private limited company or a public limited company if its paid-up capital reaches INR 50 lac or its average annual turnover over the preceding three financial years exceeds INR 2 crore, according to the Companies (Incorporation) Rules, 2014. The OPC is required to notify the appropriate ROC through Form INC-5 within 60 days of the threshold restrictions being exceeded in any of these scenarios. It should also be noted that unless an OPC satisfies one of these two conditions within two years of its inception, it cannot freely change itself into any type of business.
Number of Directors Mandatory in OPC
An OPC can only have one member. The member of the OPC is presumed to be the First Director of the OPC until the other director(s) are lawfully appointed by the member, according to Section 152(1) of the Act.
The number of directors in an OPC might be as low as one (1) and as high as fifteen (15). In order to increase the number of directors beyond 15, the OPC must enact a specific resolution to that effect.
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