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Prior to the implementation of the Companies Act of 2013 only two people could form a company. The Companies Act of 2013 supports the formation of One Person Company (OPC) in India. It governs the registration and functioning of one person company in India. In comparison with a public company a private company should have at least two directors and two members however on the contrary, one person company doesn't need any group of people to be incorporated.
As per the Section 262 of Companies Act of 2013 and official registration of a one person company in India is legal. Registering an OPC in India requires a single director and a single member representing the whole firm. This corporation type has very few compliance requirements in comparison with a private corporation.
You can access bank statements online through internet banking or by visiting a bank location. Account statements and transaction summary statements are other names for them that are frequently used.
Utilities costs typically cover electricity, gas, water/sewage, and rubbish disposal. Since they are now considered ordinary in the majority of Indian households, other services like internet, cable TV, and phone services are occasionally regarded as extra utilities. The price of utilities can vary widely, largely depending on your region, the temperature where you live, and your usage patterns. Hence these are also submitted as important documents for OPC registration.
Rental agreements are usually handed over as hard copies to the tenants. This has to be scanned and provided to the authority for documentation.
This document is from the landowner of the specific land. Every company must always maintain a registered address for the corporation under Section 12 of The Companies Act, 2013 When a business is incorporated in India, the registered address is provided as an attachment to the Spice+ form. However, if the business's address changes after incorporation, a Form INC-22 notification of the new registration address of the company must be submitted to the ROC.
A sale deed is a legal document used in real estate transactions to prove the purchase and transfer of property ownership from the seller to the buyer. This is the primary ownership transfer paperwork. A sale deed is sometimes known as the conveyance deed or the final deed.
The whole process for registering a one person company can be completed in a time span of just 20 days. All you have to do is reach out to Vakilsearch and complete the process with no delay.
Despite having a single person running all the daily activities of the company, OPC provides options for perpetual succession. After the demise of a member of the company, the nominee can run the company.
The member in a one-person company has limited liability. Since OPC is a registered company it is treated as a separate legal entity providing greater protection to its members. The liability of the member is limited to their shares so they are not liable for any losses conducted in the company. In case of bankruptcy, the creditors can sue the company and not the director of the company for procuring the company's debt.
In an OPC a single member acts as a director so they stand liable for managing the company's day-to-day activities. In this case, there is no need for an executive director to run the daily needs. A single member is more than sufficient and acts as a shareholder with all responsibilities.
Since the OPC is treated as a separate legal entity the person has the right to hold property related to business and other assets in their name. The properties including machinery factories, residential property, buildings, and other assets cannot be claimed by another person. As per law, the OPC can acquire property directly under its name.
Despite having major advantages, opening a one person company also comes with a certain set of restrictions.
Registering your business as an OPC is a perfect option for a small business structure. However, if you are planning to scale it up on greater levels then this might not work.at any given time the total number of people in an OPC is always one. If you are planning to add more members and have more shareholders you cannot register your business as OPC. So OPC is not apt to raise further capital. This will inhibit the expansion and growth of businesses.
As per the rules and regulations, OPC is not permitted to conduct non-banking financial investment activities. Registering yourself as an OPC will not provide freedom to invest in the security of other corporations.
Since the one-person company has a single person to act as both the director of the company and the management there is no clear distinction between both roles. A single person is permitted to take and approve all the decisions. So, there are higher chances of unethical practices.
The member grants the OPC a separate legal entity status. The sole person who incorporated the OPC is protected by its distinct legal status. The member is not personally liable for the company's loss; instead, his or her liability is limited to the value of the shares that he or she owns. Therefore, the OPC and not the member or director may be sued by the creditors.
One person company in India can easily raise money through venture capital, angel investors, incubators, and other sources because it is a private company. Getting money is now simple.
The One Person Company (OPC) is given some exemptions from compliance requirements under the Companies Act of 2013. The OPC is not required to prepare the cash flow statement. The secretary of the company is not required to provide any annual reports and maintain any account books.
And one person company in India can be easily integrated without any legal hassles. A member also serving as a director should provide the approval for integration. There is no minimum paid up capital requirement.
Administration of the OPC can be made simple by allowing a single person to both find and lead it. Making decisions is straightforward, and it happens quickly. The member can easily pass both ordinary and special resolutions by writing them down in the minutes book and getting just one other member to sign them. Because there won't be any internal disputes or delays, managing the company will be easy.
The OPC has the function of perpetual succession even with only one member. A nominee must be chosen by the single-member when incorporating the OPC. The candidate will take over operation of the company in the event that a member passes away.
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