One Person Company Registration in India: Everything You Need to Know
Deciding to start a business can be one of the most thrilling decisions in a person’s life, but let’s be real, it is also a little frightening! The sheer volume of legal documents, the business structure that is best to choose, and compliance can be overwhelming. If, like many growing entrepreneurs in India, you want to create a legitimate business without having a partner, there is one option for you: a One Person Company (OPC) Registration.
This article will explain what an OPC is, why it may be right for you, and how to register a One-Person Company step by step.
A one-person company is defined in India through the Companies Act, 2013. Until the introduction of an OPC, if you wanted to incorporate a company, you needed two directors and two shareholders. This meant that, if you are a solo entrepreneur, your only option to start a legitimate business was a sole proprietorship. Sole proprietorships are easy to start, but do not provide credibility, scalability, or protection from liability.
Better Credibility: People will view you as more professional when you are an OPC, including banks, vendors, and clients.
More Access to Funding: Once your business is a registered company, it will be easier to raise capital through loan funding or venture capital.
Separate Legal Entity: Your company can own land, negotiate contracts, sue or be sued as a completely separate entity.
Transferability: If you want to add a partner later in time or transfer the business to a Private Limited Company, it would be much easier with an OPC.
You can register an OPC in India if:
You are a natural person (not a company or a firm).
You are an Indian citizen and resident (or, if you are a foreign national, the OPC can be incorporated in India, but you must still appoint a resident Indian citizen as a director).
Now let’s get down to the hard facts; the OPC registration process looks like this:
First, you will need a Digital Signature Certificate (DSC) and a Director Identification Number (DIN).
Your company name must have the following format: Name (OPC) Private Limited.
It also must be unique and not appear similar to another existing company or trademark. You can search on the MCA portal for availability and reserve your name by filing the SPICe+ Part A form.
You will also have to draft the Memorandum of Association (MOA) and Articles of Association (AOA), which describe the specific objectives and rules of how your company will operate.
You will also need to prepare the following:
This is the single-access form for OPC registration. It provides:
5 . Receive your Certificate of Incorporation
After the MCA has verified all documentation, the MCA will deliver a Certificate of Incorporation (COI). Congratulations, your OPC is incorporated!
Post-Incorporation Compliance
Incorporating your OPC is only the first step. You need to take care of other compliance regularly:
However, if you are a sole entrepreneur wanting to run a serious business, One Person Company Registration is one of the best decisions you can make. You assume the protection, structure, and credibility of a company, without requiring a co-founder.
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