One Person Company Registration

One Person Company Registration is a fresh concept introduced in the Companies Act, 2013. In previous company law, a single company could not incorporate a company. If an individual wants to set up a business, then it could be a sole proprietorship. As per the Companies Act, 2013 a company can be formed with just one director and one member.

In comparison, a public or a private company should have at least two directors and two members. This corporation has very few compliance requirements in comparison to other corporate structures.

Procedure Of One Person Company Registration

One Person Company is a combination of sole-proprietorship and corporate forms of business. The following are steps discussed as follows:

Step 1: Application for Digital Signature Certificate also known as DSC

The first step is to apply for the DSC of the proposed director which requires the given documents:

• Address proof of the proposed director
• Aadhar card of the proposed director
• PAN card of the proposed director
• Photo of the proposed director
• Email ID of the proposed director
• Phone number of the proposed director

The first subscribers and directors need to obtain DSC from a certified authority. It is a completely online process that can be completed within 24 hours. For, one person company registration process the applicant must obtain the DSC which involves three verifications i.e., document, video and phone verification.

Step 2: Apply for a Director Identification Number (DIN)

Once the DSC is made, the next step is to get the DIN of the proposed director in SPICe+ Form along with the identity and address proof of the director. The DIN is obtained through filing Form DIR-3 which is available for present companies. The applicant does not need to file DIR-3 separately. Now the DIN can also be applied under the Incorporation form SPICe+ for up to 3 directors at a time.

Step 3: Application for Name Approval

After applying for DSC and DIN, the third step of one person company registration is to choose the name of the company. The name is supposed to end in the form of (OPC) Private Limited. The name is approved in the Form SPICe+ 32 application. In case the name is rejected, another name can be submitted by applying another Form SPICe+ application. After the name is approved by the MCA website, move on to the next step.

Step 4: Draft MOA and AOA

The MOA is the constitution, powers and objects of the company and AOA is the internal rules and regulations relating to the management of the company. These are required to be submitted as documents during company incorporation.

Step 5: Filing of SPICe+ Form INC-32

After the name approval and MOA and AOA drafting is done. The next step of one person company registration is to submit the details which are required to file Form SPICe+. It is also known as simplified proforma for incorporating a company electronically on the MCA portal. The details are as follows:

• Details of the company
• Details of the member and subscribers
• Application for Director identification number (DIN)
• Application for PAN and TAN
• Declaration by director and subscribers
• Declaration and certification by professional

All the documents will be attached to the SPICe+ form, SPICe+ AOA and SPICe+ MOA with the Digital signature certificate of a professional and the director. The form is uploaded on the official website of MCA for approval. There is no need to file a separate application for getting TAN and PAN numbers.

Step 6: Issuance of The Incorporation Certificate

After verification of all the forms and documents, the Registrar of Companies (ROC) will issue a Certificate of Incorporation for starting a business.

One Person Company Registration Documents

The following are required documents for OPC registration are listed below:

1. Documents required from director/ shareholder/ nominee:

Identity proof:

• PAN card
• Aadhar card or Passport or Driving license or voter identity card

Address proof:

• Telephone bill/ mobile bill
• Electricity bill/ Water bill
• Bank statement/ passbook with the list of the latest transaction
• (Anyone document not older than two months)

2. Documents to be signed by the directors

• Consent taken by the director in Form DIR-2
• Details for DIN
• Declaration of DIN (if DIN is already allotted)

3. Documents to be signed by shareholders:

• Application for Digital signature certificate
• Affidavit by subscribers and director in Form INC-9

4. Documents to be signed by the nominee shareholder:

• Details of nominee shareholder
• Consent was taken for the nomination of a shareholders in Form INC-3

5. Documents from Company/ LLP, if any:

• Board Resolution
• Authorization for the execution of documents from the company.

Compliances Required by a One Person Company Registration Online

The following are the compliances that must be followed by OPC are:

• GST Registration

  Every OPC is required to get their GST registration within 30 days of company incorporation in India under the Goods and services tax Act. GST registration is needed when the turnover is more than Rs. 40 lakhs or Rs. 20 lakhs in special category cases.

• GST Return

  When an OPC gets registered under GST, it becomes mandatory to file GST returns for a private limited company. The filing of returns is compulsory for all registered taxpayers including companies. GST returns can be filled monthly, quarterly or yearly depending upon the types of GST returns.

• Maintenance of Accounts

  For one person company registration, a person shall maintain proper books of accounts which shall represent a true and fair view of the affairs of the company.

• Statutory Audit

  Every one person company must have its book of accounts audited each financial year. The Board of directors (BOD) is required by company law to appoint an Auditor within a period of 30 days of the formation of the company.

• ROC Annual Filing

  An OPC is mandatorily required to file 3 forms every year. The filing has to be done regarding the submission of documents of financial statements i.e., balance sheet, Profit and loss account in Form AOC-4 and annual return in Form MGT-7.

Exemptions Available for One Person Company Registration

The following are the various exemptions that are availed by OPC registration:

• One Director:

  An OPC needs only one director to run the business. It is a relaxation available only to OPC since every other type of company requires a minimum number of two directors.

• Holding of Annual General Meeting:

  There is an exemption from holding the annual general meeting of the company. There is only one director for an OPC and compliance with the provisions of conducting the board meetings. The business can be transacted only through general meetings of the company using an ordinary or special resolution for a One person company registration.

• Holding of the Board Meeting:

  There is no requirement to hold 4 board meetings. An OPC can hold only 2 board meetings if such a company has more than one director. Each meeting is to be held in each half of the calendar year with a minimum gap of 90 days between the two meetings.

• Filing of Annual Returns:

  The annual return of the company has to be signed by the director and the company secretary. An OPC is exempted from the requirement to appoint a company secretary. Therefore, it is required to be signed by the director alone.

• The Signing of Financial Statements:

  In one person company registration, the financial statement and board’s report can be signed by one director.

• Cash Flow Statement:

  An OPC does not need to include a Cash flow statement as part of its financial statements.

• Audit Report and Auditors:

  An exemption is given to One person company regarding the filing of the Audit report. OPC does not require the filing of an Audit report on internal financial controls.

Benefits of OPC Registration

• Legal Status

  The OPC has a separate legal entity from its members. The separate entity of the OPC provides protection to the single owner who has formed it. The liability of the member in one person company registration is limited to his/her shares, and he/she is not personally liable for the loss of the company. Therefore, the creditors can also sue the OPC in the place of its member or director.

• Easy to Obtain Funds

  OPC is a private company and it is easy to raise funds through venture capitalists, angel investors, etc. The financial institutions consider granting loans to a company in place of a proprietorship firm.

• Fewer Compliances

  The Companies Act, 2013 provides some exemptions to the OPC related to compliances. The OPC is not needed to prepare the cash flow statement. The company secretary is not needed to sign the books of accounts and annual returns and is signed only by the directors.

• Easy Incorporation for One Person Company Registration India

  A sole owner can form and run the OPC. Thus, it becomes easy to manage its affairs. The decisions are made by a single person, therefore ease in taking decisions. The ordinary and special resolutions can be passed by the member by entering into minutes and signed by him/her.

• Non-Resident Indians (NRIs) can Register OPC

  This is an amendment in the Union budget 2021-22 that One person companies can be incorporated by non-resident Indians. A person who is staying in India for at least 120 days immediately preceding the financial year is eligible to register an OPC.

• No Minimum Capital Requirement

  There is no minimum capital required for one person company registration. For instance, it can be registered with just Rs. 10,000 as authorized capital.

One Person Company Registration Fees in India

The government has removed the government fees for the incorporation of a company in India in January 2019. However, the government fees depend on the nominal share capital being limited to Rs. 10,00,000 Rs. 2,000. However, there will be additional costs like DIN application fees, stamp duties and form filing fees for OPC incorporation.

There are different kinds of registration like GST registration, and VAT registration. If an Import Export business is there then IEC registration, For small and medium companies, Udyam registration is required. Famous one person company examples are Techmeme, Newsblur, Instapaper, Duckduckgo, etc.