One Person Company
OPC is type of company where only one person required as an shareholder & director with the benefit of the private limited company.
One Person Company was Introduced by Companies Act, 2013 in India to support those entrepreneurs who are capable to start a business on their own by allowing ventures to create a single person economic entity. There can be only one member in the One person Company as the name suggest itself.
Advantages of One Person Company
One Person Company is an entity with only one member. All the companies in India are needed to hold an annual meeting but the One Person Company is exempted to hold an annual meeting.
Every company in India is required to maintain cash flow statement, profit and lose account, balance sheet and explanatory notes but in the case of One Person Company, Cash flow statement is not required.
Eligibility for One Person Company
Only a natural person who is Indian Citizen and resident in India can incorporate One Person Company,
Resident in India means a person who had resided in India for a period not lesser than 182 days in the prior calendar year or Previous year,
Legal entities like Company or LLP cannot incorporate an One Person Company,
The minimum authorised capital is 1 Lakh,
A nominee must be appointed by the promoter during incorporation,
Businesses involved in financial activities cannot be incorporated as a One Person Company,
One Person Company must be converted to a private limited company when paid-up share capital exceeds Rs.50 lakhs or turnover crosses Rs.2 crores.
The process of Incorporation can be into four parts:
Obtaining Digital Signature: Digital Signature is mandatory to obtain for the sole promoter and the nominee which requires passport size photos, identity proof and address proof.
Obtaining Name Availability: The application for name reservation can be submitted to the Ministry of corporate affairs that will be processed in 24-72 hours.
Incorporation Filling: Incorporation can be filled by to the Ministry of Corporate Affairs with signed MOA and AOA. The residence proof, identity proof and address proof of the nominee is also required. The approval is granted by the Registrar of Companies.
Commencement of Business: After obtaining incorporation certificate , the One Person company can initiate the process for bank account opening. Once the capital is infused I the bank, the company can file for the commencement of business with the Ministry of Corporate Affairs.