OPC Compliance
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OPC Compliance: A Guide for One Person Companies
A One Person Company (OPC) is a unique business structure that allows a single individual to operate a private limited company. While it offers the benefit of limited liability and a separate legal identity, an OPC is subject to mandatory annual compliance requirements under the Companies Act, 2013. Non-compliance can lead to significant penalties and the disqualification of the director.
FileMyFirm provides expert services to manage your OPC annual compliance, ensuring your company remains in good standing with the Ministry of Corporate Affairs (MCA) and other regulatory bodies.
Mandatory OPC Compliance Filings
The designated director is responsible for ensuring all OPC compliance obligations are met.
Annual Filings with MCA
An OPC must file the following forms with the Registrar of Companies (ROC) every year, regardless of turnover:
- Form AOC-4 (Financial Statements): This form, containing the audited financial statements, must be filed within 180 days from the end of the financial year.
- Form MGT-7A (Annual Return): A simplified annual return for OPCs that must be filed within 60 days from the date the financial statements are signed.
Director and Statutory Filings
- Director KYC (DIR-3 KYC): Every director with a Director Identification Number (DIN) must complete their KYC annually by September 30th.
- Income Tax Return (ITR): An OPC must file its income tax return every year, even if there is no profit. The due date is October 31st, unless a tax audit is required.
- Statutory Audit: Unlike other small businesses, an audit of the OPC’s financial statements by a Chartered Accountant is mandatory, irrespective of turnover. The audit report must be submitted with Form AOC-4.
Post-Incorporation Compliance
After an OPC is incorporated, several immediate compliances must be met to legally commence business operations:
- Bank Account: Open a current bank account in the company’s name.
- Commencement of Business: Deposit the subscription money into the bank account and file Form INC-20A within 180 days of incorporation. The OPC cannot begin business or borrow funds until this form is filed and approved.
- Display of Company Details: The company’s name, CIN, and registered office address must be displayed at its registered office and all business locations.
OPC Exemptions
OPCs benefit from several exemptions not available to regular private companies, which simplify their compliance burden:
- No Annual General Meeting (AGM): An OPC is not required to hold an AGM.
- Simplified Board Meetings: While an OPC with more than one director must hold one board meeting per half-year, an OPC with a single director is exempt from this requirement.
- No Auditor Rotation: The provisions for the mandatory rotation of auditors do not apply to OPCs.
- Simplified Reports: OPCs are exempt from preparing a cash flow statement and a detailed board’s report, and the Companies (Auditor’s Report) Order (CARO) is not applicable to them.
Simplify Your OPC Compliance with FileMyFirm
Staying on top of OPC annual compliance can be challenging. FileMyFirm offers comprehensive, end-to-end services to handle all your regulatory needs, from statutory filings to tax returns.
- Expert Guidance: Our team of Chartered Accountants and Company Secretaries provides a clear understanding of your obligations.
- Timely Filings: We ensure all forms, including AOC-4 and MGT-7A, are filed on time to help you avoid penalties.
- End-to-End Service: We manage everything from document collection to preparing and filing returns, allowing you to focus on your business.
For hassle-free and accurate OPC ROC filing, trust the experts at FileMyFirm.
Frequestly asked questions ( FAQ )
OPC Compliance refers to the mandatory set of legal and regulatory filings and duties that a One Person Company (OPC) must fulfill to maintain its active status with the government.
An OPC is governed by the Companies Act, 2013, and its compliance obligations are regulated by the Ministry of Corporate Affairs (MCA).
An OPC’s annual compliance focuses on two primary forms filed with the Registrar of Companies (ROC):
Note: Unlike private limited companies, an OPC is not required to hold an Annual General Meeting (AGM).
Income Tax Return (ITR): Every OPC must file its income tax return using Form ITR-6, as it is a registered company.
Due Date (Non-Audit Cases): October 31st each year.
Due Date (Audit Cases): October 31st each year.
Mandatory Tax Audit: A tax audit is compulsory if the OPC’s turnover exceeds ₹10 crore in the financial year.
The law provides several relaxations to OPCs compared to regular private limited companies, simplifying their compliance burden:
No Annual General Meeting (AGM): OPCs are exempt from holding an AGM.
Simplified Board Meetings: An OPC with a single director is exempt from the requirement of holding half-yearly board meetings.
No Auditor Rotation: The rules regarding the mandatory rotation of auditors do not apply to an OPC.
Simplified Reporting: OPCs are exempt from preparing a cash flow statement and a detailed board’s report.
Failure to meet OPC compliance requirements, especially the mandatory ROC and Income Tax filings, can result in penalties:
Daily Penalty: Late filing of Forms AOC-4 and MGT-7A currently incurs a penalty of ₹100 per day for each form until the default is rectified.
Director Disqualification: Continued non-compliance can lead to the OPC’s director being disqualified from holding directorship in other companies.
Inoperative Status: The OPC may be designated as an ‘inactive’ company by the Registrar of Companies.