A One-Man Company: An Overview
The one-person company (OPC) structure has recently been introduced as a refinement of the sole proprietorship firm structure. Often, one-person companies (OPCs) are started by just one person. However, in order to form a company, at least two directors and two members must be present. If you want to launch your own business, an OPC is the best choice. Companies Act of 2013 allowed for the formation of corporations by a single individual.
One-Person Firms: A Distinctive Feature
As a result of an OPC, a single promoter is given full control of the firm, and his or her responsibilities are restricted to the contributions of the OPC. Therefore, that individual will be the sole shareholder and director (although a nominee is appointed, or has no control over the company until the real director cannot function). Employees cannot contribute to employee stock options or equity investment in such companies.
Company Incorporation for One Person
Start by contacting Vakilsearch to determine if you are eligible and get a list of all the documents required for incorporation
Apply for DSC and DIN of all the directors through our experienced team of experts
We will assist you in requesting a name reservation for your OPC and we will handle this task as well on your behalf.
Well file the Spice+ form for company incorporation at step 4
Following this, we will assist you in acquiring a PAN and TAN for your new business
The RoC will issue your corporation with its certificate of incorporation
Then, we will assist you in setting up a bank account and in all follow-up procedures after incorporation.
Conversion of a One-Person Company
Companies (Incorporation) Rules, 2014 require that a one-person firm become a private limited company or a public limited company when its paid-up capital reaches INR 50 lac or its average annual turnover over the last three financial years exceeds INR 2 crore. The OPC must notify the appropriate ROC by submitting Form INC-5 within 60 days of the threshold restrictions being exceeded in any of these situations. Also, it should be noted that unless a One person company satisfies one of these two requirements within two years of its formation, it cannot change its business model at will.
OPC Number of Directors Mandatory
Only one member may be part of an OPC. A member of the OPC is presumed to be the OPC’s First Director up until other directors are lawfully appointed by the member under Section 152(1).
There may be as few as one (1) director, and there may be as many as fifteen (15). Specifically, the OPC must enact a resolution to increase the number of directors beyond 15