Expert Assistance

A One Person Company (OPC) is a hybrid business structure that allows a single entrepreneur to operate a corporate entity. It was introduced to bridge the gap between a "Sole Proprietorship" (which has high risk) and a "Private Limited Company" (which requires at least two people).

In 2026, the OPC remains the most popular choice for solo founders, freelancers, and consultants in India who want to build a brand with the protection of a company.

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Why the OPC Structure Exists

The primary "why" behind the OPC is to encourage entrepreneurship by providing Limited Liability. In a traditional proprietorship, if the business fails, the owner's personal house and savings can be seized to pay debts. In an OPC, your personal assets are legally protected; only the money you invested in the company is at risk.

Who Can Form an OPC

• Only Indian citizens

• Must be resident in India

• Only one OPC can be owned by one person

• The person must appoint one nominee (who will take over if the owner dies or becomes incapable)

Key Features of One Person Company

• Single shareholder

• Separate legal entity

• Limited liability

• Perpetual succession (through nominee)

• Fewer compliance requirements compared to private limited company

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How to File and the Incorporation Process

The registration is now a 100% online, integrated process via the MCA V3 Portal.

1. Digital Signature (DSC): The founder must first obtain a Digital Signature Certificate to sign electronic forms.

2. Name Approval: You apply for a unique name (which must end with "OPC Private Limited").

3. The SPICe+ Form: This is a "super-form" that handles multiple registrations at once:

   • Incorporation: Setting up the company itself.

   • DIN: Getting your Director Identification Number.

   • PAN/TAN: Automatic application for tax IDs.

   • Bank Account: Pre-selection for opening a current account.

4. The Nominee: Since there is only one owner, you must appoint a "Nominee." This person takes over the company only if the original owner passes away or becomes incapacitated. You file their consent in Form INC-3.

5. Certification: Once the ROC (Registrar of Companies) verifies the documents, they issue a Certificate of Incorporation (COI).

OPC Incorporation Process (How OPC is Formed)

Step 1: Obtain Digital Signature Certificate (DSC)

• Required for online filing

• Used by the director to sign documents

Step 2: Apply for Director Identification Number (DIN)

• Mandatory for acting as a director

• Usually applied during incorporation

Step 3: Choose Company Name

• Name must end with “(OPC) Private Limited”

• Must be unique and approved by the government

Step 4: Appoint Nominee

• Nominee’s consent is mandatory

• Nominee will become the owner if the original member cannot continue

Step 5: Prepare Incorporation Documents

• Memorandum of Association (MOA)

• Articles of Association (AOA)

• Declaration and affidavits

• Nominee consent

Step 6: File Incorporation Application

• Filed online with the Ministry of Corporate Affairs

• PAN and TAN are generated automatically

• Certificate of Incorporation is issued

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Key Benefits of an OPC

• Separate Legal Identity: The company is a "person" in the eyes of the law. It can own property, take loans, and enter contracts in its own name.

• Full Control: Unlike a Private Limited company where you need a partner, here you are the 100% owner and the sole decision-maker.

• Perpetual Succession: The business does not die with the owner. Because of the "Nominee" system, the company continues to exist legally.

• Credibility: Large corporate clients often refuse to work with individuals or proprietorships. Having "Private Limited" in your name opens doors to bigger contracts.

• Easier Funding: While harder than a standard Pvt Ltd, it is much easier for an OPC to get bank loans or MSME grants than a solo freelancer.

OPC Compliance & Filing Process (After Incorporation)

OPC compliance begins immediately after the Certificate of Incorporation is issued and continues every financial year, even if the company has no business activity.

1. Appointment of First Auditor

• The OPC must appoint a statutory auditor within 30 days from the date of incorporation.

• Appointment is done by the director (only member).

• Auditor details are filed with the Registrar of Companies (ROC).

• Audit is mandatory even for zero turnover OPCs.

Purpose:

• To verify books of accounts

• To ensure compliance with Companies Act

2. Maintenance of Books of Accounts

OPC must maintain proper financial records, including:

• Cash book

• Bank statements

• Sales and purchase records

• Expense vouchers

• Asset and liability registers

• Loan and capital records

Records must:

• Be kept at the registered office

• Show a true and fair view of financial position

• Be preserved for statutory periods

3. Board Meeting Compliance

• OPC needs to conduct at least one Board Meeting in each half of the financial year

• Minimum gap of 90 days between meetings

• If OPC has only one director, board meeting is not required

• Resolutions are recorded and signed

Meeting records must include:

• Notice

• Agenda

• Minutes

4. Preparation of Financial Statements

At the end of every financial year, OPC must prepare:

• Balance Sheet

• Profit and Loss Account

• Notes to Accounts

• Cash Flow Statement (if applicable)

Financial statements must follow:

• Companies Act, 2013

• Applicable Accounting Standards

5. Statutory Audit

• Auditor examines books and financial statements

• Audit report is issued

• Any qualifications or remarks must be addressed

Audit is compulsory regardless of:

• Turnover

• Profit or loss

• Business activity

6. Annual General Meeting (AGM) Exemption

• OPC is exempted from holding AGM

• Written resolutions signed by the sole member are sufficient

• Date of signing is considered the date of AGM for filing purposes

7. Filing of Financial Statements with ROC

• Audited financial statements must be filed with ROC

• Includes:

  • Balance Sheet

  • Profit & Loss

  • Auditor’s Report

  • Notes

• Filed online using Digital Signature Certificate (DSC)

Purpose:

• Inform government of company’s financial status

8. Filing of Annual Return with ROC

• Annual return contains:

  • Company details

  • Share capital structure

  • Director information

  • Shareholding pattern

• Filed online after financial statements

This ensures:

• Legal status of OPC remains active

• Transparency in ownership

9. Income Tax Return Filing

• OPC must file income tax return every year

• Filed on Income Tax Department portal

• Includes:

  • Income details

  • Deductions

  • Tax payable or refund

• Tax audit applies if turnover exceeds limits

Even OPCs with:

• No income

• No transactions
  must file returns.

10. GST Compliance (If Applicable)

If OPC is registered under GST:

• Regular GST returns must be filed

• GST payments must be made on time

• Annual GST return is required

• Reconciliation with books of accounts is mandatory

Failure results in:

• Late fees

• Interest

• GST registration cancellation

11. Director & Nominee Compliance

Director must:

• Disclose interest in other entities

• Ensure DIN remains active

• Update KYC details as required

Nominee:

• Changes must be filed with ROC

• Written consent required

12. Event-Based ROC Filings (When Applicable)

OPC must file ROC forms when changes occur, such as:

• Change in nominee

• Appointment or resignation of director

• Change in registered office

• Increase or alteration of capital

• Change in company name

• Conversion into Private Limited Company

These filings must be done within prescribed time limits.

13. Conversion Compliance

OPC must convert into a Private Limited Company when:

• Turnover exceeds the prescribed threshold, or

• Paid-up capital crosses the prescribed limit, or

• Voluntary conversion is chosen

Conversion requires:

• Alteration of MOA and AOA

• Addition of shareholders and directors

• ROC filings and approvals

14. Ongoing Statutory Record Maintenance

OPC must maintain:

• Statutory registers

• Minutes books

• Share certificates

• Contracts and agreements

• Compliance records

These must be available for inspection.

15. Penalties for Non-Compliance

Non-compliance can lead to:

• Monetary penalties

• Late filing fees

• Director disqualification

• OPC being struck off

• Legal notices and prosecution

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Compliance and Other Needs

Even though it’s a "one-person" show, the government still requires transparency.

• Audit is Mandatory: Every year, a Chartered Accountant must audit your books, even if your turnover is zero.

• Exemption from AGM: One major relief for OPCs is that you do not need to hold an Annual General Meeting (AGM).

• Board Meetings: You only need to hold two Board Meetings a year (one in each half of the calendar year) with a minimum gap of 90 days between them. If you are the only director, even these meetings are simplified into "resolutions" entered in a minute book.

• Annual Filing: You must file Form AOC-4 (Financial Statements) and Form MGT-7A (Annual Return) within 180 days from the end of the financial year.