Is there a Benefit to Starting One Person Company Registration in Coimbatore?
Is there a benefit to starting a one person company?
Advantages and disadvantages of One Person Company, Examine the Benefits of OPC, and Also Examine the Disadvantages of OPC, What are the Advantages and Dangers of One Person Company. This article is about the pros and cons of One person Company. One Person Company is a company that can be included in the same way as a private company limited liability company. This type of company came into existence after the discovery of the Companies Act, 2013. This type of company is recommended because any person can start one by one without having to worry about another registrant or shareholder. There are many good and bad things in it. Since there is only one person, he will have to offer some relief to such a company. What i your exact need?. Here we discuss about Is there a Benefit to Starting One Person Company Registration in Coimbatore? in this article.
Notable features of the One person Company
One of the major advantages of OPC is that it can have only one member in OPC, while at least two members are required to install and maintain a Private Limited Company or Limited Liability Partnership. Like the Company, OPC is a separate legal entity from its members, offering limited credit protection to its shareholders, has business continuity and is easy to install. However, unlike Company or Proprietorship, the OPC is required to appoint one person to preside over the death or disability of one member. The OPC must also comply with many legal requirements such as company; but they are also exempt from a number of procedural procedures, such as conducting annual general meetings and general meetings.
Installing an one person Company
Unlike a company, only a natural person who is an Indian citizen and resides in India is eligible to apply to a Single Company or be a nominated member. The nominated member is one, who, in the event of the death of the promoter or the disabled becomes a member of the Company. Also, one cannot enter more than five Personal Companies. The process for installing an One person Company is almost the same as for a Company. The facilitator must first obtain a Director’s Identity Number and Digital Signature Certificate in order to apply for a “Reservation of Name of OPC” on Form No 2.7 with the relevant Registrar of Companies. After stamping the name, the facilitator must apply for OPC registration in Form 2.9 and the Organization Memorandum, Association Documents, proof of nomination and affidavit of the MOA registrar. After satisfaction, the Registrar of Companies issues a Consolidation Certificate on behalf of the OPC. It can usually take between 10 – 15 days to install an OPC.
Will One Person Company Be Right For Me?
According to the Draft Rules of Companies Act 2013, One Person Company will be converted into a private or public company where the share price is increased by more than 50 lakhs rupees and / or when the average annual income for the previous three financial years exceeds -rupees two crores. Therefore, OPC is best suited for small businesses and service providers who may choose to operate as a proprietor. From a tax perspective, OPC could be a problem compared to Proprietorship in small businesses, as the corporate tax rate is almost 30%. Properties, on the other hand, are taxable as the person in charge of the business; therefore, the tax is based on the growth of the tax rate tied to the income level. OPC business structure in India is transparent, responsive and orderly in small businesses run by a single facilitator. Although OPC offers many of the Company’s benefits, it still has significant compliance requirements and tax problems in some cases, compared to Proprietorship. Therefore, it is better for new entrepreneurs to wait and watch the emergence of OPC in India for some time before starting one.
Benefit of one person Company
As we have said before, like all other types of business, One Person Company has certain structures and minuses. Here’s a quick look at the benefits of OPC:
1. Legal-related exemptions
In terms of the provisions of the Companies Act, 2013, the One Person Company must comply with all the requirements for compliance with a limited private company. However, the government has provided many exemptions related to corporate compliance in one-person companies, making it easier for OPCs to manage their business.
2. Limited Limitation
Previously, single people who wanted to register a business could choose to own it alone. However, the debt was unlimited that the business owner’s assets are at risk if the business loses. However, in the setting of the OPC, the shareholder’s liability is limited to his or her holding of the shares. Therefore, even if the business loses, the owner’s assets are not in danger.
3. Basic Terms of Service
The eligibility criteria for OPC registration are as follows:
At least one Director and only one shareholder (same or different people)
Where payment> Rs.50 lakh and profit> Rs. 2 Crores, you need to forcefully convert One Person Company into a limited private company
4. Public Awareness
For all practical purposes, OPC is like a limited private company. People give greater trust to a limited private company which makes it easier to trust the One Person Company. Even during B2B (business-to-business) interactions, large companies prefer corporate structure over just one asset. Also, social acceptance allows you to attract quality talent and create a well-functioning pool of talent.
5. Business Continuity
It is compulsory to nominate a nominee when incorporating a one person company as a single member. This ensures that in the event that a member is unable to enter into a legal agreement, the nominee oversees the process. Inability to function may result from the death or physical / mental disability of a member. It helps the company stay in business to ensure continuity.
6. Simple loan
Compared to conventional partnerships or sole proprietorship, One Person Company is preferred by banks for loans. This is because it has a company structure. The structure of the company is clear and its endless sequence ensures that the bank does not lose any status.
7. Proper Management
In the case of an OPC with one director, managers work better because there is only one person making the decisions. However, only one member can appoint more directors in administrative matters.
Compared to a limited private company, OPC has lower compliance requirements. The One Person Company is required to hold at least one board meeting for each part of the calendar year (one between January-June and one between July-December). However, if the OPC has one director, then it can pass the decision out of the meeting and enter the details in the minute’s book.
Therefore, as you can see the benefits of OPC far outweigh its difficulties. Having said that, we believe that every business and One person has certain needs. Therefore, you should examine them before you make a decision. We hope that this article has provided you with a complete understanding of the pros and cons of founding One Person Company. If you need help registering an OPC, feel free to contact us. We will be happy to offer our services equally.