The concept of a One Person Company (OPC) was introduced under the Companies Act, 2013, to support entrepreneurs who can start and manage a business by themselves. This business structure promotes small-scale entrepreneurship and simplifies the incorporation process. An OPC is especially beneficial in cases where a business's annual turnover does not exceed Rs. 2 crores.
Detailed Benefits of Registering an OPC:
Limited Liability Protection: The owner's personal assets are safeguarded against business liabilities. This means only the money invested in the business can be lost in case of financial troubles, protecting the owner’s personal assets.
Perpetual Succession: The OPC enjoys continuity and does not cease if the owner dies or is incapacitated. It seamlessly passes on to a nominee designated by the original owner.
Enhanced Credibility: Regular mandatory audits and compliance under the Companies Act increase the credibility of OPC with banks, financial institutions, and suppliers, making it easier to secure business loans and credit.
Autonomous Control: With only one member controlling the company, decision-making is faster and implementation of strategies can be more efficient. The OPC structure allows the appointment of up to 15 directors for administrative purposes, though they don’t get any shares.
Ease of Funding: Being a registered entity, an OPC can raise funds through financial institutions easier than unregistered business forms.
Simplified Compliance: OPCs have fewer compliance requirements compared to private limited companies, such as no need to hold annual general meetings.
Comprehensive List of Documents Required for OPC Registration:
- Identity Proof of the Owner: PAN Card copy.
- Address Proof of the Owner: Aadhaar Card or Voter ID.
- Residential Proof: Latest electricity or water bill.
- Photograph: Passport-sized photograph of the owner.
- Registered Office Proof: Rent agreement if rented, property papers if owned, along with a recent utility bill.
- No Objection Certificate (NOC) from the landlord if the property is rented.
Essential Forms for OPC Registration:
- INC-9: Declaration by the sole promoter, confirming compliance with regulations.
- DIR-2: Consent to act as a director.
- MOA (Memorandum of Association) and AOA (Articles of Association) Subscriber Sheet.
- INC-3: Nominee’s consent, with PAN and Aadhar.
- AGILE PRO-S: Mandatory for GST registration, ESIC, and EPFO.
Step-by-Step Process to Register an OPC:
| Step | Process Description |
|---|---|
| 1 | Obtain DSC and DIN: These are essential for the proposed director, ensuring secure and authenticated document submission. |
| 2 | Name Reservation: File an application to reserve a unique name via SPICe+ Part A or during the SPICe submission. |
| 3 | Prepare Key Documents: Draft the MoA and AoA detailing the business's objectives and internal rules, respectively. Also, gather consent and necessary declarations from the director and nominee. |
| 4 | Filing of Incorporation Forms: Attach all documents to the SPICe+ form and submit it online on the MCA portal. |
| 5 | Payment of Fees: Calculate and pay the required stamp duty and filing fees, based on the authorized capital and the state in which the OPC will be registered. |
| 6 | Certificate of Incorporation: After verification, the Registrar of Companies will issue the COI, marking the formal registration of the OPC. |
Conclusion
Registering an OPC in India is an excellent way for a single entrepreneur to formally establish their business, benefit from limited liability, and enjoy ease of operation and funding. By following these detailed steps, an entrepreneur can navigate through the registration process effectively and set up a compliant and efficient business entity.
