One Person Company was introduced in the Companies Act to make sure a sole entrepreneur could start and manage a legal entity with limited liability. It was brought into existence to help all those enterprises with a turnover less than Rs. 2 crore. There are certain compliance requirements for an OPC which we will look at here.
OPC PAN Application
The first step to be followed after the OPC gets incorporated is to get the PAN number registered for the firm. The letter is to be duly signed by the director of the firm and submitted at the NSDL office. Along with the PAN application, submit a self-attested copy of the incorporation certificate as well. The PAN will be registered in 21 days, starting from the date of receipt of the application for the same.
Opening of Bank Account
The process is fairly simple in the case of an OPC. Since it is recognised by the Companies Act and is a corporate entity, no additional tax forms and registrations are required. According to the Reserve Bank of India’s KYC regulations, the following documents are required for opening a bank account:
1. Self-attested copies of the OPC incorporation certificates
2. Memorandum of association of OPC
3. Articles of association of OPC
4. A resolution to open a bank account in the name of the OPC
5. A copy of the PAN allotment letter
6. ID proof of the director
7. Telephone bill
It is imperative to note that all the documents mentioned above are to be self-attested with the OPC seal and the director’s signature.
Within 30 days of incorporation of the company, it needs to appoint an auditor (a chartered accountant) for auditing the financial documents and statements of the OPC
Unlike all other companies, an OPC need not have a general meeting annually. Since the board of directors has just one person, a resolution passed by that one director is acceptable and can be entered into the minutes. This signed resolution by the sole director is considered the general meeting of the firm. Provisions related to the quorum for meetings of Board do not apply to an OPC.
Financial Documents Required
All companies, including OPCs, are required to submit the following documents with the registrar of companies (ROC):
1. Balance sheet at the end of the financial year;
2. Accounts of profits and losses;
3. Cash flow statement of the financial year;
4. Records of any change in equity;
5. Any document that needs an explanatory note.
In case of a small company, dormant company or an OPC, the need for a cash flow statement is not mandatory.