Private Limited Company ( OPC )
What is OPC Private Limited Company ?
A Private Limited Company is a company which is privately held for small businesses. One Person Company means a Company which has only one person as its member. An OPC is effectively a company that has only one shareholder as its member. According to Section 2 (62) of the Companies Act, 2013. One Person Company means a company consisting of only one person as a member. Generally, Entrepreneurs choose this type of company over sole proprietorship to forge their company and to overcome the difficulties faced in the sole proprietorship firms.
Characteristics of One Person Company
• It is incorporated as a private company
• It can consist of only one member and a director
• Like in any other company a minor is not allowed to become nominee, shareholder, etc. of the company
• The term One Person Company should be included in the name of the company under brackets
• The member/nominee should be; a natural person, Indian citizen, or a person residing in India.
Advantages of OPC Private Limited Company:
1. Perpetual Succession
2. Simple to Get Loan from Banks
3. No prerequisite to holding annual or Extra-ordinary General Meetings
4. Less Legal Formalities
5. Complete Rights of one person
6. Lesser compliance
Disadvantages of One Person Company:
1. High Tax Rate
2. Consistency Cost
3. OPC is included in Name
4. One Person Management
5. Not suitable for high turnover or large business
REQUIRED DOCUMENTS :
• Telephone Bill / Mobile Bill
• Electricity Bill / Water Bill
• Bank Statement /Bank Passbook with latest transaction (Any one of the Document not older than 2 months)
• Passport size Photographs 3 each
• Identity Proof
• Email id & Contact No.
• Address for Business
FAQS
OPC company registration can be done only by Indian residents, and that too only one at a time, as per the specifications of the Ministry of Corporate Affairs.
For an OPC statutory audit is mandatory. A company needs to appoint a CA as the auditor of the Company. The auditor needs to verify the books of accounts and issue a Statutory Audit report.
An OPC can raise funds through venture capital, financial institutions. An OPC can also raise funds by converting into a Private Limited Company.
No general advantages; though some industry-specific advantages are available. Tax is to be paid at a flat rate of 30% on profits, Dividend distribution tax applies, as does minimum alternate tax.
An OPC has certain limitations. The person starting the business is its only director and shareholder. There is also a nominee director, but this person has no power whatsoever for raising equity funds or offering employee stock options. The nominee exists only to take over in case of the death or incapacitation of the director. The nominee is chosen by the director, and can be anyone, such as your spouse, parents or siblings. The nominee will need to provide identity proof during registration.