A one-person company (OPC) is a business formed by a single individual. In the Company Act of 2013, a new concept known as the One Person Company was introduced (OPC). According to the Companies Act of 2013, an individual can start a business with just one member and one director.

Advantages of OPC

1. Legal Status

• The member bestows legal entity status on the OPC. The OPC is a separate legal body that protects the single person who has incorporated it. The member’s liability is limited to their shares, and they are not personally accountable for the company’s loss. As a result, creditors have the right to sue the OPC rather than the member or director.

2. Obtaining funds is easy.

• Because OPC is a private company, it is simple to raise funds from venture capitalists, angel investors, incubators, and other sources. Banks and financial institutions prefer to lend to corporations rather than sole proprietorships. As a result, obtaining finances becomes simple.

3. Fewer Compliances

• The Companies Act of 2013 exempts the OPC from several compliance requirements. The cash flow statement does not have to be prepared by the OPC. The company secretary is not required to sign the books of accounts or annual returns, which are needed to be signed by the director.

4. Easy Incorporation

• The incorporation of OPC is simple because only one member and one nominee are necessary. A member can also be a director. The minimum authorized capital for forming an OPC is Rs.1 lakh, although there is no requirement for a minimum paid-up capital. As a result, compared to other types of businesses, it is simple to start.

5. Management is easy

• It is simple to administer the OPC’s affairs because it can be established and maintained by a single person. Making decisions is simple, and the decision-making process is rapid. Ordinary and unusual resolutions can get cleared by a single member by putting them in the minute book and getting the singleton to sign them. As a result, running and managing the business is simple because there will be no disagreement or delays.

6. Indefinite succession

• Even when there is only one member, the OPC has the feature of eternal succession. The single member must appoint a nominee while incorporating the OPC. When a member dies, the candidate takes over as president of the corporation.