One Person Company registration in India allows solo entrepreneurs to incorporate with single ownership and limited liability. Learn OPC eligibility, SPICe+ registration process, 2021 amendments, and compliance requirements in this guide. This article is written by Urvi Shah, Senior Associate at LawSikho.

Ever dreamed of running your own company but don’t want the hassle of finding partners or shareholders?

If you’re a solo entrepreneur in India, you’re in luck. 

The One Person Company (OPC) structure lets you enjoy all the benefits of running a corporate entity, limited liability, separate legal status, and credibility with clients without needing anyone else on board. It’s just you, your vision, and complete control over your business.

Introduced under the Companies Act, 2013, and made even better with the 2021 Budget amendments, OPCs have become the go to choice for ambitious individuals who want to formalize their business ideas without the complications of traditional company structures. 

Whether you’re a law student exploring entrepreneurship, a working professional ready to launch your startup, or an NRI looking to establish your Indian business presence, this guide walks you through everything you need to know about OPC registration, compliance, and why it might be the perfect fit for your entrepreneurial journey.

Understanding One Person Company Under Section 2(62) of the Companies Act, 2013

If you have ever wondered whether you can start a company all by yourself in India, the answer is yes. The One Person Company, defined under Section 2(62) of the Companies Act, 2013, is exactly what it sounds like: a company with only one person as its member. 

Before 2013, Indian law required at least two shareholders to incorporate a private company, which forced many solo entrepreneurs to bring in sleeping partners or family members just to meet legal requirements. 

The OPC structure changed this by recognizing that a single individual should be able to enjoy corporate benefits without artificial partnerships.

The concept was first recommended by the JJ Irani Expert Committee in 2005, which observed that small entrepreneurs in India faced a difficult choice between the informality of sole proprietorship and the partner requirement of private companies. 

The Committee suggested introducing a single member company form to encourage formalization of small businesses. When the Companies Act, 2013, came into force, Section 2(62) made this recommendation a reality. Today, thousands of entrepreneurs across India operate through OPCs, enjoying limited liability and corporate credibility while maintaining complete control over their ventures.

Key Features of One Person Company

The OPC structure comes with several distinctive features that make it attractive for solo entrepreneurs. Understanding these features helps you evaluate whether OPC is the right choice for your business plans.

The most significant feature is single ownership combined with limited liability. As the sole member, you own 100% of the company and make all decisions independently. 

At the same time, your personal liability is limited to the amount you have invested in the company’s shares. If the business fails or faces legal claims, your personal assets, like your house, car, or savings, remain protected (except in cases of fraud). This combination of complete control and liability protection is something a sole proprietorship cannot offer.

Another important feature is a separate legal entity status. Your OPC is legally distinct from you as an individual. The company can own property in its own name, enter into  contracts, sue others, and be sued. 

This separation means that business dealings are in the company’s name rather than your personal name, which often enhances credibility with clients, vendors, and financial institutions. Banks are generally more willing to extend credit facilities to a company than to an individual operating informally.

The nominee mechanism ensures perpetual succession, which is a corporate feature typically absent in sole proprietorships. When you incorporate an OPC, you must appoint a nominee who will become the member if something happens to you. 

This ensures that your business can continue even after your death or incapacity, protecting the interests of employees, creditors, and other stakeholders. The nominee steps into your shoes automatically, avoiding the uncertainties of inheritance disputes or business dissolution.

Finally, OPCs enjoy relaxed compliance requirements compared to regular private companies. You are exempt from holding Annual General Meetings, need only two board meetings per year instead of four, and can file simplified annual returns. 

These exemptions reduce the compliance burden and associated costs, making OPC more manageable for individuals without dedicated compliance teams.

One Person Company: MCA Amendments in 2021

The Union Budget 2021 brought transformative changes to the OPC framework through the Companies (Incorporation) Second Amendment Rules, 2021, effective from April 1, 2021. These amendments addressed several pain points that had limited OPC’s attractiveness since 2013.

The first major change was enabling Non Resident Indians to incorporate OPCs. Before the amendment, only Indian citizens residing in India could form OPCs, which excluded millions of NRIs interested in starting businesses in India. 

Now, any Indian citizen, whether residing in India or abroad, can incorporate an OPC. This opened significant opportunities for the Indian diaspora to formalize their India based business activities.

The second change was the removal of mandatory conversion thresholds. Earlier, if your OPC’s paid up capital exceeded Rs. 50 lakhs or annual turnover crossed Rs.2 crores, you were forced to convert to a regular private limited company within six months. 

This was a significant constraint because successful businesses would inevitably outgrow these limits. 

The 2021 amendment completely removed these thresholds, allowing OPCs to grow without forced conversion. You can now scale your OPC to any size and convert voluntarily only when you choose to do so.

The third change reduced the residency requirement from 182 days to 120 days. To be eligible for OPC membership, you must have stayed in India for at least 120 days during the preceding financial year. 

This relaxation benefits entrepreneurs with international commitments who travel frequently but still wish to maintain their Indian business presence.

One Person Company Registration: Eligibility and Documentation Requirements

Before you begin the registration process, you need to confirm that you meet the eligibility criteria and gather the required documents. Getting these basics right saves time and prevents application rejections.

Eligibility Criteria for Registration of a One Person Company

The eligibility requirements apply to both the sole member (you) and the nominee you appoint. Meeting these criteria is mandatory, and the MCA system will verify them during the application process.

To be eligible as the sole member, you must be a natural person who is an Indian citizen. Companies, LLPs, trusts, or other artificial persons cannot be OPC members. If you are an NRI (Non Resident Indian), you can now form an OPC after the 2021 amendments, but you must still be an Indian citizen holding an Indian passport. 

Foreign nationals cannot form OPCs in India regardless of their residency status.

You must have stayed in India for at least 120 days during the immediately preceding financial year. For example, if you are incorporating in November 2025, you need to have been in India for at least 120 days between April 1, 2024, and March 31, 2025. 

These days need not be consecutive; cumulative stay counts. Keep your passport stamps or travel records handy as proof of residency if required.

You cannot be a member or nominee in another OPC at the same time. This “one person, one OPC” rule prevents individuals from creating multiple shell companies. 

If you already have an OPC and want to start a second business, you must either convert your existing OPC to a private company or incorporate the new venture as a regular private company with a second shareholder.

Minors cannot be members or nominees of an OPC. If you are under 18, you must wait until you attain majority to incorporate an OPC. Persons who are of unsound mind or otherwise incapacitated from contracting are also ineligible.

Your nominee must meet the same eligibility criteria: natural person, Indian citizen, not already a member or nominee of another OPC, and not a minor. Choose your nominee carefully, as this person will potentially take over your business in unforeseen circumstances. Many entrepreneurs nominate a spouse, parent, or trusted friend.

One important restriction to note: OPCs cannot carry on non-banking financial activities. If your business plan involves lending, investment in securities, or other NBFC activities, OPC is not the right structure for you.

Documents Required for One Person Company Registration

Having all documents ready before starting the online application ensures a smooth process. Here is the complete checklist:

For the proposed director and member (you), you need: PAN card (mandatory for all company incorporations in India), Aadhaar card (used for identity verification through OTP), passport size photograph (recent, with white background), and address proof (bank statement, utility bill, or telephone bill not older than 60 days). 

If you are an NRI, you will additionally need your passport (notarized and apostilled) and overseas address proof.

For your nominee, you need: PAN card, Aadhaar card, passport size photograph, address proof, and the signed consent form (Form INC-3) agreeing to become the nominee.

For the registered office of your OPC, you need: proof of address (electricity bill, property tax receipt, or similar document not older than 60 days), a rent agreement if the premises are rented, and a No Objection Certificate from the property owner permitting the use of the address as your company’s registered office.

Additionally, you will need to prepare the Memorandum of Association (MOA) and Articles of Association (AOA), though these are now filed electronically as eMOA and eAOA through the SPICe+ form. The MOA contains your company’s name, registered office state, objects, and subscriber (member) details, including nominee information.

Step by Step One Person Company Registration Process Through SPICe+

The entire OPC registration process is conducted online through the Ministry of Corporate Affairs portal using the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form. 

This integrated form allows you to reserve your company name, incorporate the company, and obtain PAN, TAN, and other registrations in a single application.

Obtaining DSC and DIN

Before you can file any forms on the MCA portal, you need a Class 3 Digital Signature Certificate (DSC). The DSC is your electronic signature that authenticates documents you sign online. 

You can obtain a DSC from any licensed Certifying Authority, such as eMudhra, Sify, or NSDL. The application requires your PAN card, Aadhaar card, photograph, and a video verification. 

DSC issuance typically takes 1-2 days, and the certificate costs between Rs.2,000 and Rs. 3,000 depending on the validity period (1-3 years).

Once you have your DSC, you need to register it on the MCA portal. Download the DSC registration utility from the MCA website, associate your DSC with your user account, and verify the registration through OTP. This registered DSC will be used to sign all your incorporation documents.

The Director Identification Number (DIN) is a unique number assigned to every director in India. For new directors, DIN is obtained through the SPICe+ form itself, eliminating the need for a separate application. 

The system verifies your details with the PAN and Aadhaar databases, so ensure that your name and date of birth are identical across these documents.

Filing SPICe+ Form and Getting Your Certificate of Incorporation

The SPICe+ form has two parts: Part A for name reservation and Part B for incorporation.

In Part A, you propose a name for your OPC. Your company name must be unique (not identical or similar to any existing company or trademark), must not contain prohibited words (like “National” or “Government” without approval), and must end with “(OPC) Private Limited.” You can choose a name that includes your surname (like “Sharma Consultants (OPC) Private Limited”) or a descriptive name related to your business activity. 

The name reservation is processed within 1-2 days, and the approved name remains valid for 20 days.

In Part B, you complete the actual incorporation by providing details about your registered office, directors, subscribers, share capital, and nominee. The form integrates several linked forms: Form INC-33 (eMOA), Form INC-34 (eAOA), Form INC-3 (nominee consent), Form INC-9 (declaration by subscriber and director), and Form DIR-2 (director consent). You fill in the details, attach required documents as PDFs, and digitally sign using your DSC.

SPICe+ also integrates applications for PAN, TAN, EPFO registration, ESIC registration, and professional tax registration (in applicable states). By selecting these options, you receive these registrations along with your incorporation certificate, saving time and effort.

After you submit the form with the prescribed fees (approximately Rs. 2,000-5,000 depending on your authorized capital plus state specific stamp duty), the application goes to the Central Registration Centre at Manesar for processing. 

If everything is in order, you will receive your Certificate of Incorporation within 2-5 working days. This certificate contains your company’s Corporate Identity Number (CIN), PAN, and TAN.

After incorporation, you must file Form INC-20A (declaration of commencement of business) within 180 days and open a current bank account in your company’s name. Only after filing INC-20A can your OPC commence business operations.

OPC vs Sole Proprietorship vs Private Limited Company: Which Structure Should You Choose?

Choosing the right business structure is one of the most important decisions you will make as an entrepreneur. Each structure has advantages and limitations, and the right choice depends on your specific circumstances, risk tolerance, and growth plans.

Comparing Liability Protection and Legal Status

The fundamental difference between these structures lies in liability exposure and legal identity.

A sole proprietorship offers zero liability protection. You and your business are legally the same person. If your business incurs debts or faces lawsuits, creditors can pursue your personal assets, including your home, savings, and other property. This unlimited liability is the biggest risk of operating as a sole proprietor, especially if your business involves significant transactions, employs people, or carries operational risks.

An OPC provides limited liability, meaning your personal assets are protected from business liabilities. If your OPC cannot pay its debts, creditors can only claim the company’s assets, not yours personally (except in cases of fraud or where you have given personal guarantees). This protection is invaluable for entrepreneurs taking calculated business risks.

A private limited company also offers limited liability, similar to an OPC. The difference is that a private company requires at least two shareholders and two directors, while an OPC allows single ownership.

Regarding legal status, a sole proprietorship has no separate legal existence from its owner. Contracts are in your personal name, lawsuits are against you personally, and the business cannot outlive you. 

Both OPC and private limited companies are separate legal entities that can own property, sue and be sued, and continue perpetually regardless of changes in membership.

Perpetual succession is another distinguishing factor. A sole proprietorship ends when you die or become incapacitated. An OPC continues through the nominee mechanism, and a private limited company continues through share transmission to legal heirs. 

For businesses with long term value, employees, or ongoing client relationships, perpetual succession provides stability.

Compliance Requirements and Costs

The compliance burden varies significantly across these structures, and this directly impacts your time and money.

A sole proprietorship has minimal compliance requirements. There is no mandatory registration with the Registrar of Companies, no requirement for audited accounts (below certain thresholds), and simplified income tax filing. 

The annual compliance cost is typically under Rs. 10,000, primarily for tax return filing. This simplicity makes sole proprietorship attractive for very small businesses or those testing a business idea.

An OPC has moderate compliance requirements. You must file annual financial statements (Form AOC-4) and annual return (Form MGT-7A) with the Registrar, get your accounts audited by a Chartered Accountant, maintain statutory registers and minutes, and comply with applicable provisions of the Companies Act. 

The annual compliance cost typically ranges from Rs. 15,000 to Rs. 30,000, including auditor fees and filing charges. While higher than sole proprietorship, this cost is the price of limited liability and corporate credibility.

A private limited company has the highest compliance requirements among these three. Four board meetings per year, Annual General Meeting, detailed annual returns (Form MGT-7), and more extensive disclosures are mandatory. 

The annual compliance cost typically exceeds Rs. 25,000-40,000. For businesses with multiple stakeholders or external investors, this compliance structure provides governance safeguards.

When deciding, consider your risk profile and growth plans. If you are testing a small business idea with minimal risk, sole proprietorship might suffice initially. If you want liability protection but prefer simplified compliance, OPC is ideal. 

If you plan to raise external investment or bring in partners, start with a private limited company to avoid conversion later.

Essential Compliance for One Person Company in India

Once your OPC is incorporated, compliance becomes an ongoing responsibility. Missing deadlines results in penalties, and persistent default can lead to your company being struck off. Understanding the key compliance requirements helps you stay on the right side of the law.

Annual Filing Requirements: AOC-4 and MGT-7A

Two primary annual filings are mandatory for every OPC: financial statements and annual return.

Form AOC-4 is used to file your company’s financial statements with the Registrar. This includes your audited balance sheet, profit and loss statement, and directors’ report. 

For FY 2024-2025 (April 1, 2024 to March 31, 2025), the due date is within 180 days from the financial year end, which is September 27, 2025 (extended to December 31, 2025 by MCA General Circular). 

The financial statements must be audited by a Chartered Accountant before filing.

Form MGT-7A is the simplified annual return for OPCs and small companies. This form contains summarized information about your company’s shareholding, directors, and compliance status. 

The due date is within 60 days from the date of AGM or, since OPCs are exempt from AGM, 60 days from the deemed AGM date. For FY 2024-2025, this works out to approximately November 26, 2025 (extended to December 31, 2025).

Late filing attracts additional fees of Rs.100 per day of delay, which can quickly accumulate into significant amounts. Plan your compliance calendar in advance and work with your auditor to ensure timely completion.

Other Mandatory Compliance Requirements

Beyond annual filings, several other compliances apply to OPCs throughout the year.

Statutory audit is mandatory for all OPCs regardless of turnover. Unlike sole proprietorships, which require audit only above certain thresholds, every OPC must appoint a Chartered Accountant as auditor and get its accounts audited annually. Appoint your first auditor within 30 days of incorporation.

DIR-3 KYC is an annual requirement for all directors. By September 30 each year, you must complete your director KYC through the MCA portal. This involves verifying your PAN, Aadhaar, mobile number, and email address. 

Failure to complete DIR-3 KYC results in your DIN being deactivated, which prevents you from signing any company forms.

Board meetings must be held at least twice a year, with a gap of at least 90 days between meetings. Even though you may be the sole director, formal board meetings must be recorded in the minutes book. Use these meetings to approve financial statements, appoint auditors, and make other business decisions.

Income tax return must be filed by September 30 of each assessment year. OPCs are taxed at corporate rates (22% under Section 115BAA of the Income Tax Act or 30% under the regular regime). Your company will need a separate PAN (issued along with the incorporation certificate) and must file Form ITR-6.

Exemptions for One Person Company Compliance

The good news is that OPCs enjoy several compliance exemptions that reduce your administrative burden.

You are exempt from holding an Annual General Meeting (AGM). Since there is only one member, the concept of a shareholders’ meeting is redundant. You can approve matters requiring member approval through written resolutions recorded in your minutes book.

You need only two board meetings per year instead of four required for regular companies. Each half of the calendar year (January to June and July to December) should have at least one board meeting, with a minimum 90 day gap between meetings.

Your financial statements need not include a cash flow statement. While the balance sheet and profit and loss statement are mandatory, OPCs are exempt from the cash flow statement requirement, simplifying financial statement preparation.

Penalties for OPCs are half of those prescribed for regular companies under Section 446B. If you do face a penalty situation, the financial impact is reduced compared to what a regular company would pay for the same violation.

These exemptions make OPC compliance more manageable for solo entrepreneurs without dedicated finance or compliance teams. However, the exemptions do not eliminate compliance altogether, so maintaining a proper compliance calendar and working with professionals when needed is still essential.

Conclusion

The One Person Company structure offers a compelling proposition for solo entrepreneurs in India: corporate benefits with simplified compliance. You get limited liability protection that shields your personal assets, a separate legal entity status that enhances business credibility, and perpetual succession that ensures your business can outlive you. 

At the same time, you maintain complete control over your venture without needing to accommodate partners or shareholders.

The 2021 amendments made OPC even more attractive by removing the growth ceilings that previously forced conversion, reducing residency requirements, and opening the structure to NRIs.

Whether you are a law student planning your first venture, a professional looking to formalize your practice, or an NRI wanting to start a business in India, OPC provides a structured yet flexible framework to begin your entrepreneurial journey with confidence.

More detailed guide on this topic, click here.

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