Conversion Of Private Limited Company to One Person Company

A private limited company can convert itself into a one-person company (OPC) if it has a paid-up capital of less than Rs. 50 lakh and an annual turnover of less than Rs.2 crore. The reason for converting the private limited company into an OPC may be certain private, commercial or managerial. One Person Company is a business entity run by a sole owner with the benefit of limited liability as that of Private Limited Company.

Get Started

100%

Client Satisfaction

4.9/5

Google Rating

Affordable

EMI Options

Best Compliance Firm For Your Company

Free Legal Advice

Experts Team

Tech Driven Platform

On-Time Delivery

Overview of Conversion Of Private Limited Company to One Person Company

A private limited company can convert itself into a one-person company (OPC) if it has a paid-up capital of less than Rs. 50 lakh and an annual turnover of less than Rs.2 crore. The reason for converting the private limited company into an OPC may be certain private, commercial or managerial.

One Person Company is a business entity run by a sole owner with the benefit of limited liability as that of Private Limited Company. In addition to this, One Person Company is a separate legal entity from its members, offering protection to its shareholders and can be formed by only one director. Following points should be kept in mind while converting a Private limited company into OPC:

• Rule 7 of Companies (Incorporation) Rules, 2014 should be followed.
• No objection certificate from existing members & Creditors.
• The special resolution passed by shareholders.

Advantages of Conversion Of Private Limited Company to One Person Company

STATUS OF PRIVATE COMPANY As per S. 3 of the Companies Act, 2013, OPC is given the status of Private Companies.
VARIOUS EXEMPTIONS FROM An OPC enjoys various statutory exemptions from holding annual or extraordinary general meetings; signature on annual returns can be done by Director himself, restriction on voting rights, demand for the poll, notice for the meeting, Signature on financial statements, etc.
LIMITED LIABILITY The liability of the shareholder is limited and personal assets are safe. The liability of the shareholder will only be limited to the unpaid subscription money in his name. OPC is a separate entity and there will be a true distinction between the promoter and the company.
SINGLE OWNER There is only one owner who can act both as a shareholder as well as the director.
COMPLETE CONTROL This leads to fast decision making and execution. Yet he/she can appoint as many as 15 directors in the OPC for administrative functions, without giving any share to them.
LEGAL STATUS & SOCIAL RECOGNITION One Person Company is a Private Limited Structure in the eyes of law, which gives suppliers and customers a sense of confidence in business.
SEPARATE LEGAL ENTITY A company is a legal entity and a juristic person established under the Act. Therefore a company form of organization has a wide legal capacity and can own property and also incur debts. The members (Shareholders/Directors) of a company have no liability to the creditors of a company for such debts.
EASY COMPLIANCES OPC is one of the easiest forms of corporate entities to manage. Very few ROC filing is to be filed with the Registrar of Companies (ROC). No need to conduct the Annual General Meeting (AGM), so lesser compliance cost.
PERPETUAL SUCCESSION A company has ‘perpetual succession’, that is continued or uninterrupted existence until it is legally dissolved. A company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership.
BORROWING CAPACITY A company enjoys better avenues for borrowing of funds. It can issue debentures, secured as well as unsecured and can also accept deposits from the public, etc. Even banking and financial institutions prefer to render large financial assistance to a company rather than partnership firms or proprietary concerns.
EASY TRANSFERABILITY Shares of a company limited by shares are transferable by a shareholder to any other person. Filing and signing a share transfer form and handing over the buyer of the shares along with a share certificate can easily transfer shares.
OWN PROPERTY A company being a juristic person, can acquire, own, enjoy and alienate, property in its name. No shareholder can make any claim upon the property of the company so long as the company is a going concern.

Registration Process

Step 1: PREPARATION OF DOCUMENTS A Board meeting of director needs to conducted and a notice will be prepared and a date for the extraordinary general meeting (EGM) will be decided. During this time, we’ll complete all the formalities, from filing conversion forms to alteration of your Memorandum & Articles of Association.PREPARATION OF DOCUMENTS A Board meeting of director needs to conducted and a notice will be prepared and a date for the extraordinary general meeting (EGM) will be decided. During this time, we’ll complete all the formalities, from filing conversion forms to alteration of your Memorandum & Articles of Association.

Step 2: FILING OF DOCUMENTS Within 30 days of the Extra Ordinary General Meeting, MGT 14 needs to be filed along with altered AOA and MOA, INC 6 will also be filed for which balance sheet of last year needs to be attached, list of members and creditors will also need to be attached along with a NOC from them.

Step 3:CONVERSION TO ONE PERSON COMPANY Within 5-7 days you will get approval. We will also send you the new AOA, MOA and PAN card and the new certificate of incorporation.

 

Required Documents

1. List of all members and creditors

2. Latest balance sheet

3. Letter of ‘No Objection’ from the members and creditors

4. Letter of Consent from the Directors by way of affidavit

5. Notice of Extra General Meeting (EGM), which is held to gain the approval of Directors for the conversion of the Private Limited Company to One Person Company.

6. A certified true copy of Special Resolution

7. Altered Memorandum of Association

8. Altered Articles of Association

9. A certified true copy of Board Resolution is optional

Get Started

Easy Payment Options Available No Spam. No Sharing. 100% Confidentiality

FAQ's Conversion Of Private Limited Company to One Person Company :-

One Person Company cannot be converted into any other kind of Company until after two years from the date of incorporation of the OPC. However, in case the capital increases beyond Rs.50 lakhs or the annual average turnover exceeds Rs.2 crores. The OPC will cease to exist and then it must be converted to Private Limited Company within six months.
A Private Limited Company cannot convert itself into a One Person Company until the capital is more than Rs.50 lakhs or annual turnover is more than Rs.2 crores in the relevant amount of time.
The following steps must be taken care of after the conversion: • Arrange a new PAN card for the company • Update Company account details • Make the necessary changes in Altered Memorandum and Articles of Association

Testimonials

What Our Clients Say About Us

In this Journey, we had gained the trust of many startups and businesses in India and stands with 4.9-star rating in google reviews.

Rajesh Srivastava
Rajesh Srivastava
Startup CEO
Read More
Great services and expertise. Highly recommended, Quick work and provided good support for the entire process. Made things very easier for us and I got my first ever Trademark for my product in just no time. I recommend their services to all the Startups for a hassle-free registration and other services. Again Thank You So Much Team Legal Suvidha... Good work...
Vijaya
Vijaya
Employee
Read More
Excellent service and has been very timely in response. They are very patient too and guided us with the right steps even though we approached them with very few days left before the deadline. I highly recommend them to other startups who need legal advice and do all the paperwork at the year-end. And we would approach them for all our future requirements as well.
Krish Mundarath
Krish MundarathBusinessman
Read More
We highly recommend them. Best in class services. Thank you for helping me through the process and for prompt replies. All the Best in your Endeavors. We highly recommend them. Best in class services. Thank you for helping me through the process and for prompt replies. All the Best in your Endeavors. I will surely consider them for future work.
Inamul Hashmi
Inamul Hashmi
Businessman
Read More
Legal Suvidha filed my GST, Income Tax Returns for my business Happy by their service. They are Excellent, cost effective, efficient, co-operative & Genuine service providers keep up the good work in the future. Thank you for shaping my business in the right direction. I would suggest others to take up their services they are better than other competitions present in the market.
Previous
Next

Questions? Contact Us

Call us: +91 8130645164

Mail us: [email protected]

Subscribe To Our Newsletter!

Subscribe to our newsletter and stay updated.

Legal Suvidha App

Now all Professional Services in a Single Click !

Now get all the services required for your business packed in a single app.