Register Now
Convert OPC to Private Limited Company
Explore Funding Options to Transition Your Business from OPC to Private Limited
₹ 14000 only
Learn About Converting OPC to a Private Limited Company
Transforming a One Person Company (OPC) into a Private Limited Company (PLC) can unlock new benefits, including enhanced fundraising opportunities. An OPC can voluntarily convert to a PLC without needing to meet the typical requirements for paid-up share capital or average annual turnover. The conversion application is submitted to the Central Government after updating the Memorandum of Association (MoA) and Articles of Association (AoA) of the OPC. The legal identity of the company continues seamlessly post-conversion, along with its existing rights and obligations. Following the conversion, a minimum of two shareholders and directors must be appointed to satisfy the requirements. This change not only supports growth but also opens doors to various funding options, such as private placements and Employee Stock Ownership Plans (ESOPs).
Advantages of Converting OPC to a Private Limited Company
Raising Capital Through Public Share Issuance
Securing funding as a private limited company is generally more straightforward, as it allows for the issuance of shares and offers various avenues for raising capital, including private equity, Employee Stock Ownership Plans (ESOPs), and more.
Tax Benefits
One Person Companies are not recognized under the Income Tax Act and are categorized alongside other companies for tax purposes. Private companies fall under a tax rate of 30% on their total income. Consequently, from a tax perspective, the One Person Company structure can be viewed as less advantageous, as it results in a significant financial burden.
Limited Liability for Owners
The company’s obligations or debts do not affect the owner’s personal assets. Their liability is restricted solely to the capital they have subscribed to but not yet paid.
Operational Flexibility
When a Private Limited Company is registered, it becomes a legal entity distinct from its owners and managers in the eyes of the law. The company can conduct business in its own name, allowing it to open bank accounts, own assets, and enter into contracts with other parties. This structure also grants the company the ability to sue third parties.
Complete Registration Form
Provide us required Documents
Make an Online Payment
Our expert team will manage the Conversion of OPC to Private Limited
Certificate of incorporation will be mailed after completion of registration
How to Convert OPC to Private Limited with Corporate Shastra
Documents Required for Converting OPC to Private Limited Company
PAN Card: PAN Card of shareholders and directors. Foreign nationals may provide passport.
Identity Proof: Voter ID/ Passport/ Driving License of Shareholders and Directors.
Address Proof: Telephone Bill /Electricity Bill/ Latest Bank Account Statement of Shareholders and Directors.
Photograph: Latest Passport size photograph of Shareholders and Directors.
NRI: In case of NRI or Foreign National, documents of partner must be notarized or apostilled.
Financial Statements: Duly certified copy of latest audited Finacial Statements.
Incorporation documents of the OPC: Certificate of Incorporation, MoA & AoA to be provided.
Explore Conversion from One Person Company to Private Limited Company
What are the conditions for converting OPC to a private limited company?
Rule 6 of Companies (Incorporation) Second Amendment Rules, 2021, there are no such conditions that need to take care of. However, the below mentioned conditioned were applied before the second amendment rules, 2021:
If the paid-up share capital of the OPC hits more than ₹ 50 lakh.
If the annual turnover exceeds ₹ 2 crores consecutively for the last three (3) years.
Whether the OPC can voluntarily proceed for its conversion?
Can an OPC be converted or incorporated as a non profit organization?
What is the effect after conversion of OPC to a private limited company on the liabilities of the previous company?
Comparison of Business Structures
Proprietorship | Partnership | OPC | LLP | Private Limited | |
|---|---|---|---|---|---|
Ownership | Sole Ownership | Min 2 partners Max 50 partners | Only 1 member | Min 2 Designated Partners | Min 2 Directors Min 2 Shareholders Max 15 Directors Max 200 Shareholders |
Separate
Legal Entity | No | No | Yes | Yes | Yes |
Applicable Law | No specified Act | Partnership Act, 1932 | Companies Act, 2013 | Limited Liability Partnership Act, 2008 | Companies Act, 2013 |
Statutory Audit | Not Mandatory | Not Mandatory | Mandatory | Based On Applicability | Mandatory |
Liability | Unlimited | Unlimited | Limited | Limited | Limited |
Perpetual Existence | No | No | Yes | Yes | Yes |
Ownership Transferability | No | Yes (Restricted) | Yes (Restricted) | Yes | Yes |
Taxability | Low | High | Moderate | High | Moderate |
Compliance
Requirement | Low | Low | High | Moderate | High |