Who can form a one person company?
One natural person who is an Indian citizen can form a one person company, and must name another such person as nominee in the memorandum. There is no test of how many days the member has lived in India, and there is no minimum paid-up capital. The filing itself is on the registration page.
Who may be the member?
The member is one natural person, and an Indian citizen. A minor cannot be the member. The same person cannot be the member of more than one one person company, and cannot be the nominee of more than one. The name ends with “(OPC) Private Limited”. The member’s liability, in a company limited by shares, is limited to the amount unpaid on the shares. That limit does not remove a personal guarantee the member signs.
The company cannot be a section 8 company, and it cannot carry on non-banking financial investment, including investment in securities of a body corporate. It is still a separate person from the member: it contracts and holds property in its own name. What else it must have is on the requirements page.
Who is the nominee?
The memorandum names a nominee, with that person’s written consent. If the member dies or becomes incapable of contracting, the nominee becomes the member. Until then the nominee is not a member and is not a director. A director is appointed separately. The company needs at least one director, and may have up to 15. The subscriber is the first director until directors are duly appointed. How many directors it may have is on the directors page. The memorandum’s contents are on the memorandum page.
Which form incorporates the company?
The company is incorporated on SPICe+. That form carries the memorandum, the articles, the registered office, and the application for a director identification number where the subscriber does not already have one. It also allots the company’s PAN and TAN, so those are not a second application filed after the certificate. A name is reserved before the incorporation is submitted. The old sequence of a separate DIN, then a separate PAN after the certificate, is not the current filing.
Conversion into a private company is a choice the member makes, and it is a separate filing. The company is not required to convert because paid-up capital has crossed ₹50 lakh or average turnover has crossed ₹2 crore. Those compulsory limits, and the old form that announced them, do not apply.
Frequently asked questions
Four questions cover residence, the nominee, capital, and compulsory conversion.
Must the member have lived in India for 182 days?
No. The 2021 amendment removed that residence test. The member must be a natural person and an Indian citizen. A minor cannot be the member or the nominee.
Does the nominee become a director?
No. The nominee is named in the memorandum so that, on the member’s death or incapacity, the nominee becomes the member. The nominee is not a director by being named, and is not a second member while the member is alive.
Is there a minimum capital?
No. The Act does not set a minimum paid-up capital for a one person company.
Must the company convert at ₹2 crore of turnover?
No. The old compulsory conversion, at ₹50 lakh of paid-up capital or ₹2 crore of average turnover, no longer applies. Conversion into a private company is voluntary.
Sources
Who may incorporate a one person company is Rule 3 of the Companies (Incorporation) Rules, 2014, after the 2021 amendment that removed the residence test. The incorporation form is SPICe+.