What is a one-man company?
A one person company is a mixture of a corporation and a partnership company. The sole member of a company is its sole shareholder and may be a director. Unless otherwise stated, OPC is governed by his Companies Act 2013. A sole proprietorship is a limited liability company. Your business idea doesn’t need a partner. If you have an idea, you can easily start your own business.
OPC members must have Indian citizenship and reside in India. An OPC is eligible for conversion to a public company or a limited liability company if the paid-up share capital exceeds his Rs. An OPC cannot voluntarily change to another form of the company after two years.
A One Person Company (OPC) has the following advantages/features:
As a result of the Companies Act 2013, the concept of OPC was introduced with the following salient features:
There is a limit of one shareholder/member per company. Entrepreneurs can operate their business as a separate legal entity under this type of structure.
You cannot set up a sole proprietorship unless you are a resident of India.
If the sole member dies, a candidate will be nominated for charter.
The company should be called a “personal company”.
OPCs or sole proprietors have limited liability to their shareholders. Liquidation of the company does not put the personal assets of the partners at risk. Suppose a shareholder buys her shares worth Rs.1,000,000/- and is only liable for Rs.1,00,000.
It has all the advantages of a limited liability company, except for some limitations.
A company secretary is not required to be appointed or hold an annual general meeting.
Complete steps to register OPC:
- Obtain digital signatures (DSC) of all directors.
Obtaining a digital signature is the first step for directors. The incorporation form must be digitally signed by the directors.
- Must obtain a director identification number
A Director Identification Number (DIN) is a unique identifier assigned to a director. Directors are assigned a DIN based on their PAN.
- Choose a unique name and have it approved by the MCA
Next, it’s important to decide on a name for your company. After receiving the name approval certificate from the Ministry of Enterprise, the company must be established within 20 days.
- AOA and MOA for company formation
The MCA Portal will be updated with the company’s Memorandum, Memorandum and Articles of Incorporation within 20 days of name approval. 5. PAN and TAN should be obtained after induction
The MCA issues articles of incorporation to the company containing the CIN, PAN and TAN.
He is the only member of the OPC and has its own legal existence. Entrepreneurs with ideas but lacking funds can now start a business by registering as an OPC. OPC can provide funding, create brand equity, increase awareness, provide tax incentives, and reduce standards, among other things. After exceeding certain limits, the OPC must be changed to a limited liability company. So if a member has only one he is, choose her OPC instead of ownership. Forming a limited liability company is always preferable when there are multiple shareholders.
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Who is Eligible to Become a Member of an OPC?