One Person Company
Under Companies Act 2013 One Person Company is a private company by an Indian Owner having only one member. An additional member is required as a nominee. However, this is available for a business with a capital up to Rs. 50 lakhs and a turnover up to Rs. 2 crore. But the moment turnover goes beyond Rs. 2 crores or the capital increases to more than 50 lakhs the one person company should be converted into a private company.
For starting a business with more than one person, Private Limited Company is the option which provides certain added advantages as well.
A One Person Company (OPC) is a combined package of a Sole Proprietorship business and a Company, borrowing the best of both worlds. In cities like Delhi, whenever someone thinks to start a business, he needs to have an idea that too very much creative and innovative to proceed further. One person Company serves this purpose quite well for them.
It makes the person execute his idea without sharing his secrecy in business before hand with someone else. With just one member, these companies enjoy certain privileges or exemptions as compared to other companies.
One Person Company Registration requires following documents:
Smooth registration and less corporate formalities are few of the benefits of OPC. Single owner and limited liability also add to the advantages of a One Person Company
Requirements for One Person Company Registration
One Person Company means a company which has only one member. Under this type of business entity, there is no need for mandatory minimum two directors, as is the case in Private Limited Company incorporation.
The process of starting a one person company is same as that of a private limited company. Hence the minimum paid up and subscribed capital of the one person company is Rs 1 crore.
An Indian citizen who has been living in India for 182 days is eligible to act as a member and citizen of an OPC.
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A one person company can engage in any form of business activities apart from non banking financial investment activities including investment in securities of body corporates.
A nominee is a person who in the event of death or disability of the subscriber of the OPC shall assume his position. MOA of a one person company will mandatorily prescribe the name of the person.
Yes, the annual return of the one person company has to be signed by the sole member of the OPC.
No, FDI is not allowed for a one person company.
Below is the comparison between Sole proprietorship, Partnership, Private Limited Company, Limited liability partnership, One person company and Public limited company