One Person Company (OPC)

A One Person Company (OPC) is a private company formed with a single member, introduced by Section 2(62) of the Companies Act, 2013 to give solo entrepreneurs the limited liability and separate legal identity of a company without needing a second shareholder. It requires at least one director — the sole member usually acts as both — may have up to 15 directors, and its name must end with "(OPC) Private Limited".

Key features

• Only a natural person who is an Indian citizen, whether resident or not, can form or be the nominee of an OPC. "Resident" means staying in India at least 120 days in the preceding financial year, so NRIs now qualify.
• The member must name a nominee who consents in Form INC-3 and steps in as member on the member's death or incapacity.
• A person can incorporate only one OPC and be nominee for only one.
• An OPC cannot be a Section 8 (non-profit) company or carry on non-banking financial investment activity.

Incorporation and compliance

An OPC is registered with the Registrar of Companies through the SPICe+ (INC-32) form. It is exempt from holding an AGM, files its accounts in Form AOC-4, and files the abridged annual return in Form MGT-7A. Where there is a single director, no board meeting is required and a cash-flow statement is not mandatory.

Conversion

Since 1 April 2021 an OPC can scale without limit — the Companies (Incorporation) Second Amendment Rules, 2021 removed the old rule that forced conversion once paid-up capital crossed Rs 50 lakh or average annual turnover crossed Rs 2 crore. The company may still convert voluntarily into a private or public company at any time under Rule 6 of the Companies (Incorporation) Rules, 2014.