Transform your proprietorship into a One Person Company (OPC) and enjoy enhanced benefits.
A One Person Company (OPC) is an enhanced version of a sole proprietorship, making it an ideal business structure for medium-sized enterprises. Converting a sole proprietorship into an OPC is a smart business move, as it allows a single promoter to retain full control while limiting personal liability, thereby protecting personal assets. In an OPC, the owner acts as the shareholder, and like a private company, the OPC can appoint a separate director to manage operations. Additionally, the appointment of a nominee is mandatory for every OPC.
Protecting the company’s assets limits the owner’s liability strictly to the value of their shareholding.
Large organizations often favor working with a One Person Company (OPC) over a sole proprietorship. Being registered like a private limited company, an OPC is perceived as more credible and trustworthy, making it easier to secure funding and gain confidence from suppliers and customers.
The OPC structure is simple to manage, with only one member involved. There’s no requirement for annual or extraordinary general meetings, and decision-making is streamlined since a single person holds complete authority.
An OPC provides a structured framework akin to a private limited company, offering limited liability and organized management, whereas a sole proprietorship does not have such a formal setup.
Scanned copies of the PAN card for all directors and the nominee, along with Aadhaar card, Voter ID, Passport, or Driving License.
Recent bank statement or utility bill of the director and nominee, dated within the past two months.
No Objection Certificate (NOC) from the property owner, a utility bill not older than two months, and either a notarized rent agreement (if rented) or property registry/house tax receipt (if owned).
The nominee’s written consent must be submitted to the Registrar of Companies (RoC).
Recent passport-sized photographs of all directors and the nominee.
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*Subject to Government processing time
An OPC requires an authorized capital of ₹1 lakh to begin with. However, this amount does not need to be paid-up immediately. The capital should not exceed ₹50 lakh during incorporation.
Once incorporated, a company remains active and in existence as long as it meets its annual compliance requirements. Failure to comply may result in the company becoming dormant and eventually being struck off the register. However, a struck-off company can be revived within a period of up to 20 years.
A One Person Company (OPC) limited by shares must adhere to the following requirements:
It must have a minimum authorized share capital of ₹1 lakh.
Transfer of shares is not permitted to any other individual.
The OPC is not allowed to invite the public to subscribe to its securities.
If the OPC, whether limited by shares or by guarantee, enters into a contract with its sole member—who also serves as the director—the terms of the contract must be documented in writing. These terms should either be included in the company’s memorandum or recorded in the minutes of the next Board meeting following the contract.
Additionally, the OPC must notify the Registrar of Companies about any such contract within fifteen days of its approval.
No, an individual is allowed to form only one One Person Company (OPC) at a time. The same restriction applies to a nominee director as well.
To register a One Person Company (OPC) in India, it is mandatory for the director and the subscriber to the Memorandum of Association (owner), as well as the nominee, to obtain a Digital Signature Certificate (DSC) and Director Identification Number (DIN). Additionally, a registered office must be in place for completing the online registration process.
The promoter must ensure that the proposed name for the OPC is unique and not similar to any existing company or trademark. Additionally, all required documents related to the subscriber, nominee, directors, and registered office must be in proper order as per the guidelines.
To learn more about selecting a company name, visit: Mark Business Identity Wisely – Choosing the Name of a Company.
Yes, an OPC can be converted into a Private or Public Company after two years from the date of incorporation.
A nominee is an individual appointed during the incorporation of the OPC. In the event of the owner’s death or incapacity, the nominee becomes the member of the OPC, ensuring its perpetual existence.
In case of cessation of the OPC member due to death, incapacity, or change in ownership, Form INC-4 must be filed with the ROC, providing details of the new member.
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Evolve your proprietorship and tap on to the OPC advantage
