What must a one person company have?
A one person company must have one member, a nominee named in the memorandum, and at least one director. The member can be that director. The name ends with “(OPC) Private Limited”. It does not hold an annual general meeting. It is still a company, so it still keeps books, appoints an auditor, and files its financial statements and its annual return.
Who can form it?
Only a natural person who is an Indian citizen can be the member. A minor cannot be the member or the nominee. One person cannot be a member of more than one OPC, and cannot be the nominee of more than one OPC. The nominee gives written consent before incorporation and becomes the member if the original member dies or becomes incapacitated. The nominee is not a second member while the original member is in place, and is not a director merely by being named.
There is no minimum paid-up capital. An OPC cannot be incorporated as a section 8 company, and it cannot carry on a non-banking financial investment activity. How the company is registered is on the OPC page. The number of directors, which can be more than one, is on the directors page.
Which meetings does it hold?
An OPC does not hold an annual general meeting. Where it has only one director, a decision is recorded in writing in the minute book, signed and dated, and that date is the date of the decision. It does not hold a board meeting for that decision. Where it has more than one director, it holds at least one board meeting in each half of the calendar year, and at least 90 days pass between those two meetings. It does not follow the four-meeting rule that applies to an ordinary private company.
Which filings still apply?
The board appoints the first auditor within 30 days of incorporation. The financial statements of an OPC are filed within 180 days of the financial year end, because there is no annual general meeting from which to count 30 days. The annual return is Form MGT-7A. The income-tax return is the company’s return. Conversion into a private company is allowed, and it is a separate filing. The old rule that forced a conversion once paid-up capital exceeded ₹50 lakh, or average annual turnover exceeded ₹2 crore, and the two-year bar on a voluntary conversion, do not apply. The conversion itself is on the conversion page.
Frequently asked questions
Four questions cover residence, board meetings, the old conversion line, and the nominee.
Must the member be resident in India?
The member must be a natural person and an Indian citizen. The Act does not add a minimum number of days of residence as a condition of forming the OPC.
Does every OPC hold two board meetings?
No. An OPC with only one director does not hold a board meeting. It records the decision in the minute book. An OPC with more than one director holds at least one meeting in each half of the calendar year, at least 90 days apart.
Must an OPC convert when capital crosses ₹50 lakh?
No. The old rule that forced a conversion at ₹50 lakh of paid-up capital, or ₹2 crore of average turnover, no longer applies. Conversion into a private company is a choice and a separate filing.
Is the nominee a director?
No. The nominee is the person who becomes the member if the original member dies or becomes incapacitated. The nominee is not a director by being named.
Sources
A one person company is section 2(62) of the Companies Act, 2013. It has one member. The nominee is named in the memorandum. It does not hold an annual general meeting.