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One Person Company (OPC) Registration
What is One Person Company (OPC) Registration?
One Person Company (OPC) Registration is a legal process through which a single individual can establish a company with limited liability in India. An OPC allows a solo entrepreneur to own and manage a business without needing to share control or ownership with others. This structure combines the benefits of a sole proprietorship and a private limited company, providing the entrepreneur with limited liability protection while maintaining full control over the company.
Key Features of One Person Company (OPC)
- Single Shareholder:An OPC can have only one shareholder, who is the sole owner of the company.
- Limited Liability: The liability of the sole shareholder is limited to the extent of their share capital in the company, protecting personal assets from business liabilities.
- Separate Legal Entity: The OPC is a separate legal entity from its owner, meaning it can own property, enter into contracts, and sue or be sued in its own name.
- Nominee Director: The sole shareholder must appoint a nominee director in the Memorandum of Association (MoA), who will take over in the event of the original shareholder’s death or incapacity.
- No Minimum Paid-Up Capital: There is no minimum paid-up capital requirement to start an OPC.
- Perpetual Succession: The company continues to exist regardless of changes in ownership, ensuring continuity of business operations.
- Less Compliance: OPCs face fewer compliance requirements compared to private limited companies, making them easier to manage.
Requirements for One-Person Company (OPC) Registration
- Shareholder: Only one person can act as the shareholder and director of the OPC. The same individual cannot incorporate more than one OPC or be a nominee in more than one OPC.
- Nominee: The shareholder must appoint a nominee who will become the shareholder in case of death or incapacitation of the original owner. The nominee must provide their consent in writing.
- Director: The shareholder must act as the sole director or appoint other directors, but the total number of directors cannot exceed 15.
- Registered Office: The OPC must have a registered office in India where official correspondence can be sent.
- Digital Signature Certificate (DSC): The shareholder must obtain a DSC for signing electronic documents during the registration process.
Documents Required for OPC Registration
- For the Sole Shareholder and Director:
- PAN Card (mandatory for Indian citizens)
- Passport (for foreign nationals)
- Address proof (Aadhaar Card, Voter ID, or Passport)
- Residence proof (Latest bank statement, electricity bill, or telephone bill not older than 2 months)
- Digital Signature Certificate (DSC)
- Director Identification Number (DIN)
- For the Nominee:
- PAN Card
- Address proof (Aadhaar Card, Voter ID, or Passport)
- Residence proof (Latest bank statement, electricity bill, or telephone bill not older than 2 months)
- Consent form from the nominee in Form INC-3
- For the Registered Office:
- Proof of registered office address (Rent agreement or ownership deed)
- Utility bill (Electricity, water, or telephone) not older than 2 months
- No Objection Certificate (NOC) from the property owner (if the office is rented)
- For the Company:
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Affidavit and consent of the director (in Form INC-9 and DIR-2)
Procedure of One Person Company Registration
Obtain Digital Signature Certificate (DSC)
- The sole director must apply for a DSC to sign documents digitally.
Apply for Director Identification Number (DIN)
- Obtain a DIN for the proposed director by applying through the MCA portal.
Name Approval (RUN Form)
- Choose a unique company name and get approval from the Ministry of Corporate Affairs (MCA). The name should follow the OPC naming guidelines.
Prepare Incorporation Documents
- Draft key documents like:
- Memorandum of Association (MoA) – Defines business objectives.
- Articles of Association (AoA) – Governs company operations.
- Consent of Nominee (Form INC-3) – A nominee must be appointed to take over in case of the owner’s incapacity.
- Draft key documents like:
Filing for Incorporation (SPICe+ Form)
- Submit all required documents to the MCA using SPICe+ (Simplified Proforma for Incorporating a Company Electronically).
- Pay government fees and stamp duty.
Issuance of Certificate of Incorporation
- Upon approval, the Registrar of Companies (ROC) issues the Certificate of Incorporation, confirming the OPC’s legal existence.
Apply for PAN & TAN
- Once incorporated, apply for the company’s PAN & TAN.
Open a Business Bank Account
- A corporate bank account must be opened in the OPC’s name.
Benefits of a One Person Company (OPC)
- Limited Liability – The owner’s personal assets are protected from business liabilities.
- Full Control – A single person owns and manages the company.
- Separate Legal Entity – The OPC is a distinct legal entity, separate from its owner.
- Easy Fundraising – More credibility compared to sole proprietorships, making it easier to get funding.
- Minimal Compliance – Fewer legal formalities compared to Private Limited Companies.
- Perpetual Succession – Business continues even if the owner is unable to manage it (nominee takes over).
- Tax Benefits – Lower tax liability compared to sole proprietorships.