Advantage of one person company

This helps the reader a quick insight about the One Person Company (OPC) which includes advantages, some key point about incorporation of OPC.

1. PRESENTATION ON ONE PERSON COMPANY

2. MEANING & DEFINATION The concept of OPC came into existence with Companies act 2013. Basic fundamental principle behind the formation of the same is to give opportunity to single person who is resident of India and Indian resident to form/ incorporate his own company under his full control. Moreover, it is the combination of sole proprietorship and company.

3. FEATURES OF ONE PERSON COMPANY (OPC) OPC require only one shareholder for its formation. Such shareholder shall nominate another person who shall act as shareholder in case of his death/ incapacity. Only one director is required for incorporation of OPC. Same person can act as shareholder as well as director. Company may have maximum 15 directors.

4. ADVANTAGES(PROS) OF OPC Less Compliances burden.An OPC is not required to hold Board Meeting, General Meeting etc. OPC(One Person Company) gives corporate entity to sole proprietorship. The liability of proprietor is unlimited but if he does business through OPC, then the liability of such person is limited to his shareholding. In most of the cases Banks required business man to convert his firm into private limited company before sanctioning funds, so it is better to startup business as One Person private limited company rather than proprietary firm.

5. Under OPC(One person company),decision making process is much faster than any other business forms as whole control is held by single person. In OPC, single person may appoint directors for administrative purpose without giving any share to them. Very limited forms is to be filled with ROC and mandatory rotation of auditor after expiry of his terms is not applicable on OPC.

6. DISADVANTAGES(CONS) OF OPC Same person shall not incorporate more than one OPC. Minor i.e. a person of less than 18 years old can not be act as shareholder/nominees in OPC. Only natural person who is an Indian citizen and resident of India shall be eligible to form an OPC. OPC is useful for only small business. Maximum paidup share capital is to be rupees 50 lakh or turnover 2 crore , if exceed then OPC must be converted either into Private/Public Limited Company.

7. An OPC can not carry out Non-Banking Financial Investment activities. One person company can not be incorporated/ converted into section 8 company. As compare to proprietorship, OPC need to be registered with Registrar of Companies under the Companies act 2013 and registration fees is to paid while in case of proprietorship firm no registration is required .

8. CONTACT ADDRESS Monetic Corp Consultants Private Limited 460, THIRD FLOOR, KOHAT ENCLAVE PITAMPURA, DELHI-110034 [phone] [email protected] https://www.registrationwala.com/