In the case of a private company, at least two members are needed which is not the same in the case of OPC. One Person Company characteristic is such that it has just one shareholder who holds a 100% stake of the company. OPC Company registration is simplified with online filing and process.
Single Entrepreneur must Register in OPC.
With the establishment of the Companies Act, 2013, a new kind of company that entrepreneurs could set up was a one-person company. More often than not, people with sole proprietorships choose company incorporation as a one-person company, as it easily enables them to transition into a corporate framework. This is essentially because a one-person company functions as a combination between a sole proprietorship and a corporate company, allowing more significant legal requirements flexibility.
If you're wondering how to register a company in India as a one-person company, note that simply a single shareholder must do so.
Additionally, for the company registration to happen, there must also be a minimum of one director. However, keep in mind that if your company surpasses an annual turnover of 2 Crore, you have to register as a Pvt Ltd company.
While this may not be applicable during your business's early stages, it may become a pertinent issue later.
One-person companies are not liable to hold annual meetings. In fact, they are only required to have a board meeting twice a year as section 174 of the Companies Act 2013, related to board meetings doesn’t apply to such companies. This makes them very easy to run.
Most banking and financial institutions prefer lending their money to businesses that have undergone the company incorporation instead of proprietorships.
In the event of a financial crises, you can rest assured that your personal assets will not be seized by the bank as you can enjoy a limited liability.
Financial elements such as a Director’s remuneration, rent, and interest are tax-deductible, ensuring you have to pay fewer taxes and enjoy higher profits.
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