One Person Company Registration
In the last few years, our country India has seen a huge growth in entrepreneurial ventures in which every single person has a great desire to set up their own business and want to contribute to the economic circle.
From this perspective of a law firm, the concept of a One Person Company (OPC) represents a watershed moment in corporate law, providing solo entrepreneurs with a structured method to operate with less liability and increased credibility. As legal advisors, we see OPC’s as a useful tool for balancing the liberty of sole proprietorships with the legal safeguards normally provided to bigger corporations. Our duty is not only to assist the seamless setup of OPCs, but also to assure regulatory compliance, protecting our customers’ interests while empowering them to follow their business objectives with confidence. Our firm specialises in OPC creation and compliance, and we seek to promote the entrepreneurial spirit by offering thorough legal counsel targeted to the unique needs and objectives of solo businesses.
Free Consultation by Expert
One person company (OPC) is seen as a wise and innovative option among the various business structures available. It is specifically designed to make the overall process of settling a business much more accessible while still providing the benefits of limited liability.
At Blacktie Legal Services India LLP. We fully understand the complexities that come with building a business, so we are committed to guiding you through a seamless OPC registration process. This article by us very clearly explains the essentials of OPC registration, its benefits, eligibility criteria and the procedural steps involved.
Understanding One Person Company (OPC)
Introduced under the Companies Act, 2013, the concept of the One Person Company allows a single individual to incorporate a company with limited liability, which means the owner’s personal assets are protected in the event of business insolvency. OPC is a suitable structure for solo entrepreneurs who wish to enjoy the advantages of a corporate entity without the need to have partners or co-founders.
Understanding an OPC involves recognizing it as a tailored solution for individual entrepreneurs seeking the benefits of limited liability and corporate status while retaining control over their business operations. It combines the autonomy of a sole proprietorship with the legal protections and operational flexibility of a private limited company, making it a viable choice for many aspiring business owners.
Legal Framework of OPC
The structure, the One Person Company was provided under the Companies Act 2013 implemented from April 1, 2014. Section 2 (62) of the Act has defined an OPC as a company which has only one member.
The purpose of this legal provision is to encourage other people, especially sole traders to undertake trading activities and they will be provided with corporate personality that does not need them to have more than one director or shareholder.
Eligibility Criteria for OPC Registration
To register an OPC, it is essential to meet specific eligibility criteria, which we have mentioned below:
- Single Shareholder: The company must have only one shareholder, who must be an Indian citizen and resident in India. A resident is defined as a person who has stayed in India for at least 182 days in the preceding financial year.
- Nominee Appointment: The shareholder must appoint a nominee who will take over the company’s operations in the event of the shareholder’s death or incapacity. The nominee must also be an Indian citizen and resident.
- Business Activities: An OPC can engage in any lawful business activity, except for certain financial activities such as Non-Banking Financial Companies (NBFCs) and investment in securities.
- Name of the Company: The name of the OPC should be unique and must end with the words “(OPC) Private Limited.” The proposed name should not be identical or similar to an existing company or trademark.
Required Documents for OPC Registration
We have briefly mentioned below all the required documents for OPC one person company registration:
- – PAN card of the only shareholder/director
- – Voter I’d card/passport/ certified copy of Aadhaar card of the sole shareholder/director
- – Voter ID Voter Passport Voter Driver’s license any of the three (3)
- – Copy of the most recent utility bill, which can be an electricity, water, or gas bill, among others.
- – Lessee agreement (if the office is leased)
- – The original Home Search Report and No Objection Certificate (NOC) from the landlord (where applicable).
- – Memorandum of Association (MOA)
- – Articles of Association (AOA)
- – Consent letter from the nominee (appointed by the sole shareholder of the company).
- – Declaration from the sole member of the company and director
- – Declaration signed by the only shareholder/M.D./CEO
- – DSC of the sole shareholder/director as proof that they are a digital signing certificate holder.
- – Director Identification Number (DIN) of the sole shareholder/director.
Procedure for One-Person Company (OPC) Registration
We have explained the overall procedure of OPS one person company registration, in a reasonable manner step by step below:
- Digital Signature Certificate: The first step is to get a Digital Signature Certificate (DSC) for the intended director and nominee. The DSC is beneficial on several occasions during the registration process, where various documents have to be digitally signed.
- Director Identification Number: The next step is to apply for the Director Identification Number (DIN) for the proposed director. The DIN is a registration number that every person who wants to become the director of a company needs to have.
- Name Reservation: After DSC and DIN are ready the next step of incorporation is to apply for the name reservation through the MCA website. The name should be unique as it will brand the business and it should also be in compliance with the MCA naming requirements.
- Drafting of Memorandum and Articles of Association: The MOA and AOA are essential documents that outline the objectives, rules, and regulations of the company. These documents must be drafted carefully and submitted along with the registration application.
- Filing the Incorporation Form: The subsequent process requires submission of the incorporation form, which is specific as SPICe Form INC-32, along with most required documents, like DSC, DIN, MOA, AOA, proof of the address of the Registered Office, identity proof, and address proof of the director and nominee.
- Certificate of Incorporation: Finally, after the ROC’s confirmation of the executed application and accompanying documents, the OPC is formally formed after receiving the Certificate of Incorporation. After this, the company can start its business from the incorporation date.
Post-Registration Compliance
Once the OPC is registered, it must adhere to specific compliance requirements to ensure smooth functioning and legal validity:
- Annual General Meeting (AGM): Even though an OPC is not under the obligation to conduct an AGM, it is required to conduct at least two board meetings in the first and second half respectively of the calendar year with a gap of minimum 90 days.
- Financial Statements and Annual Return: The OPC is legal to prepare financial statement and annual return as report to the ROC yearly. Such documents must bear the signature of the director and filled in the correct time frame.
- Income Tax Returns: The income tax return is required to be submitted every year to the tax authorities by the company, whether it is making profits or not and whether it is a small/big company or merely an entity earning a turnover that is not even close to being profitable. It is essential for the filing of returns to be done early enough so as to avert the wrath of the law and penalties.
- Statutory Registers: The OPC is required to keep specific legal registers, such as the members register, directors register, and the register of charges, among others. These registers should be updated from time to time and kept in a place where they can be easily accessed.
- Compliance with GST and Other Laws: Based on the business type, OPC may be required to follow standards of Goods and Services Tax (GST), code of Labor, and other legal provisions.
Conclusion
The best structure for a sole trader is undoubtedly the One Person Company (OPC) as it is easy to set up, flexible and the legal responsibility of the trader is limited. Hence, at Blacktie Legal Services India LLP, we are providing quality advice and services in OPC registration to start the entrepreneurial venture in the right way.
It is true that the concept implies the creation of an entirely new company and requires large capital investments, but this model can be useful for any innovative start-up company, as well as for an existing company owner who has long dreamed of changing the company’s problematic corporate governance structure. Consult with Blacktie Legal Services India LLP today for moving on the path of OPC registration and actualizing your business dreams.
What we can offer ?
Blacktie legal services India LLP legal firm can offer a range of services tailored to assist individuals in establishing and operating a One Person Company (OPC). Here are the key services that our firm can provide, please have a look on below points:
- Formation and Registration:
- Consultation: Provide initial consultation to assess the suitability of an OPC structure for the client’s business goals.
- Document Preparation: Assist in drafting and preparing all necessary documents, including the Memorandum of Association (MoA) and Articles of Association (AoA).
- Application Filing: File the OPC registration application with the Registrar of Companies (RoC) and handle all procedural formalities.
- Compliance and Regulatory Advice:
- Legal Compliance: Ensure compliance with all regulatory requirements under the Companies Act, 2013, including directorship and shareholder requirements.
- Annual Compliance: Assist in annual compliance obligations such as filing of annual returns, financial statements, and conducting Annual General Meetings (AGMs).
- Statutory Filings: Manage filings related to changes in company details, directorship, share transfer, etc.
- Corporate Governance:
- Board Meetings: Provide guidance on convening and documenting board meetings and resolutions.
- Minutes Maintenance: Assist in maintaining proper records of board meetings and resolutions to ensure corporate governance standards are met.
- Intellectual Property Protection:
- Trademark Registration: Assist in registering trademarks and protecting intellectual property rights associated with the OPC’s brand or products.
- Copyrights and Patents: Provide advice on copyright protection for creative works and patent registration for inventions, if applicable.
- Contracts and Agreements:
- Drafting Contracts: Draft and review contracts, agreements, and terms of service tailored to the OPC’s specific needs, such as vendor contracts, employment agreements, and client agreements.
- Negotiation: Assist in negotiating favourable terms and conditions in contracts to protect the OPC’s interests.
- Conversion and Restructuring:
- Conversion Services: Facilitate the conversion of an OPC into a private limited company or other corporate structures as per the client’s evolving business needs.
- Restructuring Advice: Provide strategic advice on corporate restructuring, mergers, acquisitions, or dissolution of the OPC, if required.
- Legal Advisory and Dispute Resolution:
- General Legal Advisory: Offer ongoing legal advice and support on corporate matters, regulatory changes, and compliance issues affecting the OPC.
- Dispute Resolution: Represent the OPC in legal proceedings, arbitration, or mediation to resolve disputes effectively and protect its legal interests.
By providing these complete services, Blacktie legal services India LLP legal company may assist entrepreneurs and business owners in properly managing their OPC’s while guaranteeing legal compliance and capitalising on opportunities.
The autonomy of a sole proprietorship with the credibility and limited liability protections of a corporate entity. With streamlined compliance requirements and operational flexibility, OPCs empower individuals to pursue their business ambitions confidently while adhering to regulatory standards. Whether you’re a budding entrepreneur or an established professional seeking a scalable business model, the OPC structure provides a clear path towards growth and sustainability.Consult with our best legal experts today to embark on your journey with the support and expertise needed to navigate the complexities of company formation and governance.