What are the benefits of OPC?

Benefits of OPC

• The primary benefit of a One Person Company is that it allows for greater control and flexibility for the individual running the business. Unlike a partnership firm or a Limited Liability Partnership (LLP) firm, the sole shareholder has complete control over the company's decision-making process.
• Another advantage of a One Person Company is that it requires fewer compliances than other business forms. The company is only required to file an annual return and has no other compliances such as audits or filing of balance sheets. This makes it very attractive for small businesses just starting and needing to focus on growth.
• The taxation benefits are also desirable. One-Person Companies are treated as separate entities for taxation purposes, and the profits are taxed at a lower rate than those of a partnership firm or LLP. This makes a One Person Company a viable option for entrepreneurs who wish to save on their tax bills.
• In addition, a One Person Company also has certain advantages when raising capital. It can have a maximum of 200 shareholders, making raising funds through equity investments easier for the business. Moreover, the company can borrow funds from banks and other financial institutions, giving it more significant resources.

Eligibility criteria for OPC

• The individual should be an Indian citizen and resident of India.
• The individual should not be a minor, i.e., they should be of 18 years or above.
• The individual should not be a Promoter or a Director in any other company.
• The individual should not have incorporated more than one OPC.
• The individual should not have any existing OPC in operation.
• The individual should not have been declared a person of unsound mind by any court.
• The individual should not be convicted of any offense related to a company's promotion, formation or management.
• The individual should not be disqualified from being a company director.

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