The Future Of One Person Company In India

New and small business owners who operate independently may have challenges running the business and dealing with legal matters that affect the company. However, there is a convenient possibility for the one-person business – One Person Company Registration. OPC registration came into existence under the Companies Act, 2013 whereby the incorporation of a new company and its operation could be done by an individual person as well as is less as that of a private limited company.

Here in this blog, readers will understand the ways in which the OPC Registration model is changing the prospects for sole proprietor businesses in India.

What Makes One Person Company Unique?

One Person Company Registration is one of the hybrids of individual ownership and corporation. While operating under a sole trader system that comes with unlimited liability the OPC offers the following benefit to the entrepreneurs, limited liability. If you have plans formalising a business but do not wish to venture into any financial danger, then this model works best for you.

1. Legality with the Feature of Limited Liability

If you opt to go through the OPC company registration corporation, you are protected by what you put in the company. This means that one has the freedom to protect their own assets from being similarly liquidated if there is a wrinkle in business fortunes.

2. One Man Businesses

When you incorporate a company as an OPC, you get all the benefits of being a sole owner of the company but at the same time are able to leverage the limited company benefits such as easier access to loans, better brand image, and many more.

The Benefits of OPC Registration:

1. Simplified Compliance

One Person Company Registration has been proven to have comparatively easier requirements to meet. As compared to Private Limited Companies, OPCs are less compliant in nature and come under the ambit of less compliance. This means that more paperwork would be done away with as would most statutory meetings.

2. Minimal Share Capital

Unlike most start-ups, it has no minimum capital requirement because capital expenditures play a major factor in its business. There is no need to start focusing on continuous large capital investments. The formation of an OPC can be done with minimal share capital, which makes it convenient to start up.

3. Tax Advantages

One of the benefits of OPC Company Registration is the impact on taxes. For instance, expenses related to business, employees’ wages, or any depreciation can be claimed and thus the taxable income comes down.

Steps to Register a One Person Company:

If you are quite sure that One Person Company Registration is the right thing to do for your business here are some steps to follow.

1. Get DSC (Digital Signature Certificate)

The first thing and only requirement in the process of Company Registration as an OPC is to have the director acquire a DSC or Digital Signature Certificate. The forms are to be signed by the DSC.

2. DIN - Director Identification Number

If you want to register your company with an OPC, then you would require a DIN that is peculiar to the director of your company. It is the unique number allotted to the Ministry of Corporate Affairs, MCA.

3. Company Name

Distinguishable name selection is required especially for the OPC registration service. The name of the company should not bear any similarity with another company and should meet the specific requirements of MCA.

4. Submit the OPC Registration Form  

The documents to be filed with the MCA are the Memorandum of Association to be filed with the Articles of Association. The company’s incorporation process will be complete once the Registrar has signed the documents that he will verify and upon which he will provide a Certificate of Incorporation.

5. Open a Bank Account 

When you get the company incorporated, you can then access a bank account in the name of the company and this makes the company a legal entity of its own kind.

Conclusion

One-Person Company Registration for Solopreneurs is deemed appropriate for business individuals who want to build a bigger organization without holding large amounts of capital or being liable for its loss. Opting to register a company as an OPC also protects your personal liability while positioning your firm for long-term success.