One Person Company Registration

According to the Companies Act, 1956, minimum 7 shareholders or members are required for the formation of a Public limited company while minimum 2 members are required to register a private limited company. According to the provisions of the section 2 (62) of the Companies Act 2013, one can start a one-person company in India which requires only one member to form a legal entity.

The main benefit of forming a one-person company is that it is a separate legal entity which requires only one member and provide its sole shareholders limited liability of protection. It is simple to incorporate for the continuance of the business. All those provisions which are applicable to private companies are also applicable to the one person company (OPC).


How to form an One Person Company (OPC)?

According to the Rule 3 of the Companies (Incorporation) act, 2014, the one person company member should be a resident of India. She/he must be a citizen of India and should not be a minor. The resident of India means that person who is living in India for a time period equal to one hundred and eighty-two days as per the last calendar year.

The natural person means a normal person. It is not an entity such as a HUF, a corporate body, a partnership firm, or a sole proprietorship. A foreign citizen or non-resident Indian is not allowed to make an OPC in India. Minimum one director is required for the formation of OPC. It must have one promoter also. Director and promoter might be the same person. To incorporate more than one OPC, a person is not eligible. This is according to the Rule 3 (2) of the Companies (Incorporation) rules, 2014.

It is essential to choose a nominee of the single company member. The consent of the nominee is required in written form. A nominee will only become the member of the company if the member is died or incapable of contract. The name of the nominee is also written in the memorandum of association. A person can not be the nominee of more than one OPC.


What Is Included In Our Package?

Eligibility Consultation

Document Preparation

Application Drafting

Government Fees


Step by Step Procedure for One Person Company Registration

  1. 1

    The first step to form a one person company is to get the Digital Signature Certificate (DSC)of the director of the company. For this purpose, the following documents are needed: -

    • Phone Number
    • Email ID
    • Photo
    • PAN Card
    • Aadhar Card
    • Address Proof
  2. 2A person who wants to form a one person company is required to apply for a Directors Identification Number (DIN) in the form DIR – 3 with proof of address and name of the director.

  3. 3Choosing the name of the proposed company: The promoter of the one person company or OPC need to apply for the company name to the registrar of companies for the incorporation of the company in E form INC 1 by paying rupees one thousand via Debit/Credit card or net banking. The name of the OPC will be “XYZ (OPC) Private Limited”.

  4. 4

    You need to submit the following documents to the Registrar of Companies: -

    • Articles of Association
    • Memorandum of Association
    • Consent of Nominee in form INC – 3 on behalf of director or promoter
    • Aadhar card and PAN card of nominee
    • NOC and proof of ownership from the owner along with the proof of the registered office
    • Consent and affidavit of the director in form DIR – 2 and INC – 9.
    • The final declaration of the professional to certify all the compliances
  5. 5

    Approval or Filling of forms with Ministry of Corporate Affairs: -

    All the documents will be affixed to Articles of Association (AOA), Memorandum of Association (MOA), and Spice form along with the digital signature certificate of the professional and the director. All these documents will be uploaded for approval to the website of ministry of corporate affairs.

  6. 6

    Issuance of Certificate of Incorporation

    After the necessary procedure of verification, the ROC (Registrar of Companies) will issues the certificate of incorporation for the commencement of business.


Concerns Regarding OPC Registration

  • For one person company, rupees one lac is the minimum authorized share capital.
  • The maximum and minimum number of members for the one-person company is only one.
  • After incorporation of the company, the memorandum subscriber requires to make the payment for the total value of shares owned by him.
  • The nominee and member of a One person company shall not be a minor.
  • An OPC can be limited by unlimited company or shares or limited by guarantee.
  • An OPC limited by shares requires to fulfill the following requirements: -

    • The minimum paid-up capital of the OPC is one lac.
    • Its shares are not permitted to transfer to someone.
    • An OPC does not able to offer any invitation to the public to subscribe for the company securities.
    • After the two years from the date of incorporation of the OPC, it can not convert voluntarily into any other type of company. The exception is when its average annual turnover is more than rupees two crores, or its paid-up share capital is more than rupees fifty lacs.
    • Similar taxes are imposed on a OPC just like a private limited company.

Factors to Consider While Choosing The OPC Name

Simple & Short

The name should be short and simple. People can easily pronounce or recall the name of your company.

Relevant name

The name of your OPC must be meaningful for your business. It should be fit into the branding strategy of the company.

Distinct

Your OPC name should not be similar or identical to an existing trademark, company or LLP name.

Suffix

There is no any need to finish OPC name with “Limited” or “Private Limited”.

Should not be offensive/illegal

The LLP name must not be illegal. It must not be abusive.

The name should as per the laws

The name of your OPC should not violate any laws.


Frequently Asked Questions

The first step to incorporate an OPC is to file the form INC-1 for the availability of name. After the approval of name, INC-2 need to be filed within sixty days after filing the form INC-1 for the incorporation of OPC.
The form INC -4 is required to be filed by the company in case of termination of OPC member on account of change in ownership, incapacity to contract or on account of death. In the similar form, the user requires to give information of the new OPC member.
The OPC will mandatorily convert itself into public or private company if its annual average turnover of immediately previously three consecutive financial years is more than rupees two crores or if its paid up share capital is more than rupees fifty lakh rupees.
The RoC is informed by the OPC in a form named INC – 5, if the threshold limits is exceeded and is needed to be converted into public or private company.
You need to filed INC-5 within 60 days after exceeding the threshold limit.

For the conversion of an OPC into private or public company, form INC-6 need to be filed. To convert itself into an OPC, the private company needs to file form INC – 6. During the time of such conversion into OPC, the annual average turnover of the private company must not be more than rupees two crores. Also, the paid-up share capital of the private company is not more than rupees fifty lacs.

The company must be having one member and require to appoint a nominee to work as member in case of incapacity or death of the member at the time of OPC conversion.

The time limit for filing the form INC – 60 is 30 days if the conversion is voluntary. If the conversion is mandatory then the time limit is 6 months.
A normal person who is a resident of India and an Indian citizen will be eligible to act as a member of an OPC.
A Person can be a member of one OPC only.
Form INC – 4 is to be filed in case of withdrawal of consent by the nominee of an OPC or in case of intimation of change in nominee by the member.

When a normal person is a member in One Person Company and if he becomes a member in another OPC by virtue of being a nominee in other OPC, then he requires to fulfills the eligibility criteria of a member in one OPC with a duration of one hundred and eighty days. She or he can cancel his membership from the both OPCs within 180 days.


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