OPC Compliance Requirements
One person companies are companies formed by a single person. A company can be formed with just 1 director and 1 member, according to Section 2(62) of the Company’s Act of 2013.
The OPC structure was introduced to allow a sole entrepreneur to start and manage a limited liability entity. Its main purpose is to assist all those sole member businesses.
After registering, it is advisable to purchase the following stationery:
The name of every company, including OPCs, must be displayed outside its premises.
Company rubber stamp: For the execution of various legal documents related to banking functions, board resolutions, etc., a rubber stamp is required. It is necessary to purchase a round rubber stamp and a straight rubber stamp bearing the names of the company and its director.
Each invoice, notice, circular, and other official document must have the company’s name and address printed on the letterhead.
OPC PAN APPLICATION
The first step after an OPC is incorporated is to obtain a PAN number. A duly signed application must be submitted to the NSDL office by the director of the OPC. A self-attested copy of the incorporation certificate must also be submitted with the PAN application. From the date of receipt of the application, the whole process of getting a PAN card can take up to 15 days.
OPENING OF BANK ACCOUNT
It is fairly easy to open a bank account for your OPC. Since it is a corporation recognized by the Companies Act. Additional tax forms and registrations are not necessary.
To open an account with a bank, the following documents are required:
- Self-attested copies of the OPC’s incorporation certificate
- Memorandum of association
- The articles of association
- Opening a bank account in the name of the OPC
- A copy of the PAN allotment letter
- ID proof of the director
- Telephone bill
It is imperative to note that all documents mentioned above must be self-attested with the OPC seal and the director’s signature.
To audit the company’s financial documents and statements, the first auditor must be a chartered accountant within 30 days of incorporation.
As the statutory audit is a requirement for an OPC. Within 15 days of the first Annual General Meeting, an OPC must also appoint a statutory auditor who will serve for 5 years.
It is not necessary for an OPC to hold a general meeting every year. Furthermore, the provisions related to quorums in meetings do not apply to an OPC.
As there is only one director on the board, a resolution passed by the director can be entered into the minutes book. Once signed by the sole director, this resolution becomes the act of the general meeting.
It is important to remember that under Section 173 of the Act, at least one meeting of the board of directors must be held in each half of the calendar year and the gap between two meetings shall not be less than 90 days.
OPC ANNUAL FILING (MGT-7)
The OPC shall file its annual reports with the Registrar of Companies. Form MGT-7 should be attached to the return and filed with the ROC. In addition, the company secretary must sign such an annual report. When there is no company secretary available, the director must sign the return. Each OPC registered in India is required to file a return annually.
Documents required for Form MGT-7:
- List of main business activities
- Details of shares and shareholding
- List of debentures and loans
- Details of other securities held by the company
FINANCIAL DOCUMENTS REQUIRED (AOC-4)
The following audited documents must be filed with the Registrar of Companies within 180 days from 31 March of the financial year by all companies, including OPCs:
- Balance sheet
- Accounts of profits and losses
- Audit report
- Records of any change in equity
- Any document that needs an explanatory note.
In the case of an OPC, the need for a cash flow statement is optional and not mandatory.
It’s hard enough to run a one-man show, but keeping up with compliance is another burden best left to experts like Vakilsearch. Contact our team to ensure that all of your compliance requirements are handled smoothly.