OPC Registration



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A Step-by-Step Guide to One Person Company (OPC) Registration in India

Starting a business as a solo entrepreneur in India is now more streamlined thanks to the concept of the One Person Company (OPC). Introduced under the Companies Act, 2013, OPC allows individual entrepreneurs to reap the benefits of both sole proprietorship and corporate structure. Here’s a comprehensive guide to registering an OPC in India.

What is a One Person Company (OPC)?

A One Person Company (OPC) is a type of company that has a single shareholder who is also the director. It blends the flexibility of a sole proprietorship with the advantages of a corporate framework, offering limited liability protection and easier compliance requirements.

Benefits of Registering an OPC

  • Limited Liability: Protects personal assets from business liabilities.
  • Separate Legal Entity: OPC is a distinct entity from its owner.
  • Ease of Management: Simpler to manage compared to a Private Limited Company.
  • Continuous Existence: OPC enjoys perpetual succession, unaffected by changes in ownership.
  • Increased Credibility: Enhances the business’s credibility with customers and investors.

Eligibility Criteria for OPC

  • Only one shareholder: The individual must be an Indian citizen and resident.
  • Nominee: A nominee must be appointed, who will take over the company in case of the original shareholder’s death or incapacity. The nominee must also be an Indian resident.
  • Not applicable for certain sectors: OPCs cannot engage in non-banking financial investment activities.

Steps to Register an OPC in India

1. Obtain Digital Signature Certificate (DSC)

The first step in the registration process is to obtain a DSC for the proposed director. This certificate is used to digitally sign the registration forms. You can obtain a DSC from certifying authorities like eMudhra, Sify, or N-Code.

2. Acquire Director Identification Number (DIN)

The Director Identification Number (DIN) is a unique number assigned to a director. Apply for DIN through the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form on the Ministry of Corporate Affairs (MCA) portal.

3. Name Reservation

Choose a unique name for your OPC and apply for name approval through the RUN (Reserve Unique Name) service on the MCA portal. Ensure the name is not similar to any existing company names or trademarks.

4. Draft Memorandum and Articles of Association (MoA and AoA)

  • MoA: Specifies the objectives and scope of the company’s operations.
  • AoA: Contains the rules and regulations governing the company’s internal management.
    Both documents must be signed by the sole shareholder and the nominee.

5. File Incorporation Application

File the SPICe+ form on the MCA portal. This integrated form simplifies the process by combining multiple steps into one. The following documents must be attached:

  • Identity proof and address proof of the director and nominee.
  • Copy of PAN card.
  • Passport-sized photographs.
  • Proof of registered office address (e.g., utility bill, rent agreement, or sale deed).
  • Consent of the nominee in Form INC-3, along with the nominee’s ID and address proof.

6. Obtain Certificate of Incorporation

Once the application is reviewed and approved by the Registrar of Companies (RoC), you will receive the Certificate of Incorporation. This certificate confirms the formation of your OPC and includes the Corporate Identification Number (CIN).

7. Apply for PAN and TAN

After incorporation, apply for a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) for the OPC. These are necessary for conducting financial transactions and complying with tax regulations.

Post-Incorporation Compliances

1. Open a Bank Account

Open a bank account in the name of the OPC to manage its financial transactions.

2. GST Registration

If your business turnover exceeds the prescribed threshold limit, register for Goods and Services Tax (GST).

3. Professional Tax Registration

Register for professional tax if applicable in your state.

4. Maintain Proper Records

Maintain proper financial records and file annual returns with the RoC. Compliance with MCA regulations is crucial to avoid penalties.

Conclusion

Registering an OPC is an excellent option for solo entrepreneurs looking to leverage the benefits of a corporate structure while maintaining control over their business. By following the steps outlined in this guide, you can ensure a smooth and hassle-free registration process. For personalized assistance, consider consulting with legal professionals or company registration experts to navigate specific nuances and streamline the registration process.

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