One Person Company: What Is It?
We must first examine the identity that a one-person corporation generates in order to comprehend its definition. In addition to offering members and directors numerous advantages, a registration confers corporate standing. A private business must have a minimum of two members, although OPC does not have this requirement. The Companies Act of 2013 established this type of company structure in order to remove this disadvantage and enable a single individual to benefit from One Person Companies. Online filing and procedures streamline the registration process for one-person companies.
The characteristic of a one-person corporation is that it has a single shareholder who owns all of the business. In order to preserve the permanence of the appointment
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Independent Legal Status
The status of a distinct legal entity would be granted to a one-person company. Unlike a proprietorship firm, this type of OPC registration guarantees that the entity is distinct from the owner. OPC is able to enter into a contract with the parties and own the assets under its own name. The owner has no influence over the company's actions. The primary advantage of OPC registration is this.
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Reduced Needs for Compliance
Unlike a private corporation, a single person firm enjoys the benefit of exemption from several regulations. OPC is exempt from compliance requirements such as holding board and general meetings. However, if there are more than one director on the board, a board meeting is required.
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Owners' Limited Liability
One advantage of registering OPC is that it creates a distinct legal body with obligations and liabilities that are not imposed on the personal assets of the lone member. A member's liability is capped by the remaining balance of the capital they have subscribed for. Except in a few specific circumstances, the member's personal assets are safeguarded even in the event of liquidation.
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Ownership and Management Separation
Due to the need to manage a business, the owner of the OPC may designate a director even if the company is owned by a single individual. While the member would be able to generate earnings by directing efforts towards different firms, the director or directors are tasked with the operational responsibilities. The shareholder, however, has total control over their status as a stakeholder in a one-person company.
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Register your business as Sole Proprietorship
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