One Person Company (OPC)
A company that needs only one person who can incorporate a company by becoming its sole member and sole director requiring a nominee of the sole member.
Key Attributes
| Single Ownership/ One member | Company may be a One Person Company (OPC) which requires only one person as a subscriber to form a company and such a company will be treated under the Act as a private company |
|---|---|
| One Director | Only one director is required to form an OPC |
| No sharing of Profit and Loss | All the profits and losses are of the owner |
| Limited Liability | Liability of the owner is limited |
| Duration | Since there is only one member in an OPC, his death will result in the nominee choosing or rejecting to become its sole member. |
Advantages of OPC:
- only one person required who can be sole member and director
- sole members own all the profits
- OPC gets a number of exemptions from various legal provisions
- liability of the owner is limited
- legal status and social recognition for your business
Disadvantages of OPC:
- suitable only for small business
- since there is only one member in an OPC, his death will result in the nominee choosing or rejecting to become its sole member.
- nominee is required to be appointed
- OPC can’t do all business like that of Non Banking Finance Company (NBFC)
Procedural Aspects
- Choose and apply name of the OPC
- Submit requisite forms & documents (including MOA AOA)with ROC and obtain Certificate of Incorporation
- Open a bank account
- Apply for registrations like GST, IEC, Startup, MSME etc
