OPC and Pvt. Ltd. Co., OPC vs Pvt Ltd Co., One Person Company, Private Limited Company, OPC vs Private Limited Company, Ebizfiling

One Person Company and Private Limited Company

OPC and Private Limited Company are two different business structures governed by the Companies Act. The concept of One Person Company encourages single and enthusiastic entrepreneurs to operate own venture. However, Private Limited Company requires two persons to incorporate the company. 

 

Do you want to start a new business but have confusion as to what structure of company you should choose? This article might help you to ease your decision.

 

What is the meaning of OPC and Pvt Ltd Co.?

One Person Company means a Company which has only one person as its member. An OPC is effectively a company that has only one shareholder as its member. 

 

A Private Limited Company is the form of the company where minimum two members are required and maximum number of members can be 200. The liability of the members of a Private Limited Company is limited to the amount of shares held by them.

Comparison between OPC and Private Limited Company

There are few similarities as well as a few differences between the OPC and Pvt. Ltd. Co. Let us discuss both here for your better understanding.

Similarities Between OPC and Pvt. Ltd. Co.

  • Separate Legal Entity: Both of them have separate legal entity. That means OPC or Private Ltd Co. is treated as a different individual in the eyes of law. 
  • Benefits on taxes: To the both types of business structures tax benefits are given. The tax benefits would be 25% from the profits.
  • Limited Liability: In case of OPC the Sole owner and in case of Pvt. Ltd. Co. the shareholders have limited liability to the extent of their shares.
  • Registration Process: Both the companies are required to be registered with the Ministry of Corporate Affairs.

OPC and Private Limited Company – Quick Comparison Table

Particulars OPC  Pvt. Ltd. CO.
Law Applicable Companies Act 2013 Companies Act 2013
Minimum share capital No requirement for minimum share capital. If capital exceeds 50 lakhs, opc gets converted to Pvt. Ltd. No requirement for minimum share capital
Members required

Minimum one

Maximum one

Minimum two

Maximum up to 200

Directors required

Minimum one

Maximum 15

Minimum two

Maximum 15

Board meeting One meeting in each half of the year. The gap between the two meetings must be at least 90 days One meeting in each quarter of the year. The maximum gap between the two meetings can be 120 days
Statutory Audit Compulsory Compulsory
Annual Filing Financial Statements and Annual returns to be filed with registrar Annual accounts and Annual returns to be filed with RoC
Liability Limited Limited
Transferability of shares Can be made by altering MOA Can be easily transferred
Foreign Direct Investment Not eligible for FDI Eligible via automatic route
Suitable to which type Individuals whose capital requirements are 50 lakhs and turnover is less than 2 crs Business, trade, manufacturers, large industrial establishments
Company Name Should end with (OPC) Pvt. Ltd./ (OPC) Ltd. Should end with Pvt. Ltd.

 

Have more questions about Private Limited Company

 

One Person Company and Private Limited Company have a lot of similarities yet they both are different in many of their characteristics. If you are one person who wants to start a business One Person Company is definitely for you as the concept of One Person Company (OPC) was introduced with an objective to encourage single and enthusiastic entrepreneurs to operate their own venture. While in case you are more than one persons who wish to start the business together then Private Limited Company is for you. 

 

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6 thoughts on “OPC V/S Pvt. Ltd. Co.

  1. If it is OPC Pvt.Ltd who will be having right to mortgage or alinate the company properties.

    1. Hi S.Venkatramreddy,

      Thank you for your query.

      Well in case of One Person Company the Director has the right to mortgage or alinate the Company Properties. The director can do so by passing a resolution.

      Hope this helps. For further queries, you may get in touch with team Ebizfiling on +919643203209 / info@ebizfiling.com

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