Convert OPC to Private Limited Company

Explore funding options to grow your business from OPC to Pvt. Ltd

Convert OPC to Private Limited Company

Know about conversion of OPC to a Private Limited Company

Converting One Person Company to a Private Company can open avenues to pursue additional benefits such as fund raising. An OPC can voluntarily convert into PLC without fulfilling the criteria of paid up share capital and average annual turnover. The application of conversion is made to Central Government after alternation of MoA and AoA of the OPC. The legal existence of the company continues even after the conversion and so do their rights and liabilities. With its conversion into Private Company, minimum 2 shareholders and directors must be appointed to fulfil the minimum requirement. Conversion helps with the growth opportunities along with additional funding options of private placement funding, ESOP and many more.

Benefits of Conversion of OPC to a Private Limited Company

Easier to Raise Funds

Raising funds as a private limited company is a comparatively easy task as it gives an opportunity for raising shares and has many ways to raise funds in the form of private equity, ESOP, and more.

Limited Liability of Owners

The obligation or debts of the company does not create a charge over the owner’s personal assets. Their liability is limited only to the subscribed capital unpaid by them.

Taxation Benefits

One Person Company is not recognized under the Income Tax Act and hence it has been put in the same category as other companies for taxation purpose. Private companies have been placed under the tax bracket of 30% on total income. Thus, from the perspective of taxation, the concept of One Person Company becomes a less profitable concept as it imposes a heavy financial load.

Separate Legal Existence

A Private Limited Company is registered, a legal entity is born in eyes of law, which is separate from its owners and managers. The company can operate in its own name from opening a bank account to own assets and enter into a contract with parties. This also provides the capacity to sue third parties.

Documents Required to convert OPC to Pvt Ltd company

PAN Card

PAN Card of shareholders and Directors.
Foreign nationals must provide a 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

Need assistance? Don’t worry, experts are here to help!
Call us at: 1800 313 4151 or Email us: support@legalwiz.in

Convert OPC into Private Company in 3 Easy Steps

1. Answer Quick Questions

Spare less than 10 minutes to fill in our questionnaire
Provide basic details & documents required for registration
Make payment through secured payment gateways

2. Experts are Here to Help

Assigned Relationship Manager
Procurement of Digital Signatures (DSC)
Approval from Central Government for Voluntary Conversion
Increase in the Authorized Share Capital
Alteration of MoA & AoA
Application for PAN & TAN

3. Your Company is Registered

All it takes is up to 20 working days*

*Subject to Government processing time

Process of converting OPC to Pvt. Ltd.

Day 1-2

Consultancy and assistance for conversion
Collection of basic information & documents
Application of DSC of new director

Day 3 – 8

Drafting of necessary resolutions
Drafting of other required documents & affidavit
Alteration of MoA & AoA
Provide required documents drafted after the signature

Day 9 – 15

Online filing of form for alteration in MoA & AOA
Government processing time to approve the application*

Day 16 onwards

Online filing of form INC – 6 for voluntary conversion

Explore one person company to private limited company conversion

Frequently Asked Questions

2021-12-10T11:27:01+05:30

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.

2021-12-10T11:28:21+05:30

Whether the OPC can voluntarily proceed for its conversion?

Yes, OPC can voluntarily convert itself into a Private Company or Public Company with adherence to the basic criteria to fulfill. In the case of Private Limited, 2 directors and shareholders are necessary. For, public company, a minimum of 3 directors and 7 shareholders are mandatory as per the Companies Act 2013.

2020-07-27T10:19:27+05:30

Can an OPC be converted or incorporated as a non profit organization?

NO, an OPC cannot be incorporated as or converted into a company for non-profit, charitable purpose, and it cannot carry out non-banking, financial, or investment activities including investment in securities of any corporate body.

2020-07-27T10:19:41+05:30

What is the effect after conversion of OPC to a private limited company on the liabilities of the previous company?

After the conversion, the liabilities, debts or obligation of the company shall not be affected in any way. Hence, the company shall be liable for all its previous obligations.

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