Why Convert One Person Company to Private Limited Company?
Convert OPC to Private Limited
Private Limited Company is a more trusted business entity compared to One Person Company. A Private Limited Company can attract investors much easily than One Person Company. An OPC only can converted in to Private Limited Company voluntarily after 2 years of its incorporation. After modifying the Memorandum of Association (MoA) and Article of Association (AoA), the application for conversion to Private Limited Company is to be made with Central Government (Ministry of Corporate Affairs). Even after the conversion to Private Limited Company, the legal existence of OPC continues and there by their rights and liabilities too persists. To convert an OPC to Private Limited Company, minimum 2 shareholders and directors must be appointed to fulfill the minimum requirement.
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Benefits of Converting OPC to Private Limited Company
Easy Fund Raising
Private Limited Company registration process is stringent enough to make this structure credible among others which make fundraising or borrowing from external sources easier. The organization itself provides a number of ways to raise funds in the form of private equity, ESOP, and more.Show Less
Owners’ Limited Liability
The company’s obligation or debts of does not create a charge over the owner’s personal assets. Their liability stays limited only to the capital subscribed and unpaid by them.Show Less
Management and Ownership Separation
The separate ownership and management help both – the company and the management to focus on their potential works. The shareholders assign responsibility to operate and run the company without losing control in the form of voting.Show Less
Separate Legal Existence
Once the Company registration in India is done, a legal entity is born in eyes of law. This separates itself from its owners and managers. The company can operate on its own name simply by opening a bank account to own assets and enter into contract with parties. This also provides right to sue third parties in case of any defaults.Show Less
Documents Required to Convert OPC to Private Limited Company
PAN Card
PAN Card of shareholders and Directors
Passport
Foreign nationals must provide a valid passport.
Identity Proof
Aadhaar card and Voter ID/ Passport/ Driving License of Shareholders and Directors
Director’s Address Proof
Latest Telephone Bill /Electricity Bill/ Bank Account Statement of Shareholders and Directors.
Photograph
Latest Passport size photograph of Shareholders and Directors.
Business Address Proof
Latest Electricity Bill/ Telephone Bill of the registered office address
NOC from owner
No Objection Certificate to be obtained from the owner(s) of registered office
Rent Agreement
Rent Agreement of the registered office should be provided if any
Notarization
In case of NRI or Foreign National, documents of director (s) must be notarized
Incorporation Details
Incorporation Details of the OPC to be converted
Financial Statements
Duly attested copy of latest audited financial statements of the OPC to be converted
Convert OPC to Private Limited Company in 3 Easy Steps
Step 01
Fill up the registration form
Select any package suits your requirement · Fill up the form which will take less than 10 minutes · Make payment through secure payment gateway. Step 02
BookMyTM is Here to Help
Your queries will be answered quickly and effectively · Provide details & upload documents required for Pvt. Ltd Company registration · Procurement of Digital Signatures (DSC) · Approval from MCA for Voluntary Conversion · Application for company name registration · Modification of Documents including MOA and AOA Step 03
Your Private Limited Company is incorporated.
Certificate of Incorporation · Application for PAN and TAN All it takes 15 to 20 working days*.*Subjected to Government Processing Time.
Process of Converting OPC to Private Limited Company
- 1
Day 1 - 2
Consultation on Conversion of OPC to Pvt. Ltd Company · Collection of Information · Collection of required documents (Scanned copies) · Review of documents and information provided · Application for Digital Signature (DSC) of new director
- 2
Day 3 - 9
Checking the availability of Name · Finalizing the name with the directors · Modifying MoA, AoA & Other required documents · Review and confirmation form directors
- 3
Day 10 - 12
Name Reservation under SPICe · Filing company registration application · DIN allotment application · Application for PAN and TAN of company
- 4
Day 13 - 15
Name reservation application under SPICe · Filing company registration application · DIN allotment application · Application for PAN and TAN of company
- 5
Day 16 - 20
Your Private Limited Company is incorporated. · *Subjected to Government Processing Time
Frequently Asked Questions
Converting a One Person Company (OPC) to a Private Limited Company (PLC) allows for the addition of multiple shareholders and directors, facilitating business expansion and investment opportunities. It provides limited liability protection, enhances credibility with stakeholders, and enables perpetual succession, ensuring the business continues despite changes in ownership or management. It also allows the company to raise capital through equity.
No, conversion is not mandatory unless the OPC exceeds the threshold limits (previously set but removed in 2021). As per the Companies (Incorporation) Second Amendment Rules, 2021, an OPC can voluntarily convert to a PLC at any time by passing a special resolution, regardless of paid-up capital or turnover.cleartax.in
Key documents include:Memorandum of Association (MoA) and Articles of Association (AoA) with proposed alterations.No Objection Certificate (NOC) from creditors, if applicable.Consent of the existing member and proposed directors/shareholders.PAN and identity/address proofs of directors and shareholders.Digital Signature Certificate (DSC) and Director Identification Number (DIN) for at least two directors.Proof of registered office address for the PLC.Board resolution approving the conversion and alterations to MoA and AoA.Form INC-6 for application to the Registrar of Companies (RoC).Financial statements and annual returns of the OPC.
The conversion process typically takes 15-30 days, depending on document preparation, name approval (if required), and processing of Form INC-6 by the Registrar of Companies (RoC). The timeline may vary based on RoC verification and compliance requirements.
The business name can remain the same, provided it complies with MCA naming guidelines and is available. The suffix “(OPC) Private Limited” will be replaced with “Private Limited” to reflect the new structure.
The assets and liabilities of the OPC are transferred to the Private Limited Company as part of the conversion process, as per Section 18 of the Companies Act, 2013. This transfer does not affect existing debts, liabilities, obligations, or contracts, which continue under the new entity. A sale agreement may be required for clarity.cleartax.in
The conversion may be tax-neutral if it complies with Section 47(xiv) of the Income Tax Act, 1961, which requires the sole member to hold at least 50% of the voting power in the PLC. However, tax implications such as capital gains may arise depending on asset transfers. Consulting a tax professional is recommended.
A Private Limited Company requires a minimum of two directors and two shareholders, as per the Companies Act, 2013. The sole member of the OPC can be one of the shareholders, and additional members must be added to meet this requirement.cleartax.in
Yes, it is advisable to inform clients, vendors, and stakeholders about the conversion to maintain transparency. Contracts, bank accounts, licenses, and business communications should be updated to reflect the new Private Limited Company status.
BookMyTM provides end-to-end support, including obtaining DSC and DIN, drafting and altering MoA and AoA, preparing and filing Form INC-6, obtaining NOCs, and ensuring compliance with MCA and tax requirements for a seamless conversion from OPC to Private Limited Company.
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