Tax Benefits: An OPC is taxed like any other company, which can provide tax benefits compared to a sole proprietorship. Separate Legal Entity: An OPC is a separate legal entity from its owner, which can improve its credibility and reputation in the market. Limited Liability: As an OPC, the liability of the sole shareholder is limited to the extent of his/her shareholding.
As per the Companies Act, 2013, which establishes a process to change one kind of company into another, a PLC (Private Limited Company) may be converted into an OPC (One Person Company). With effect from 1 April 2014, Section 18 of the Act expressly permits the conversion of an existing private limited company that has already been registered.
The duties and legal commitments of the business before conversion would not change as a result of the PLC becoming an OPC, and the new OPC would be responsible for them. Such claims, liabilities, and obligations would also be legally enforceable.
The organizational framework of a private firm frequently disintegrates when one of its promoters decides to leave his job. The expert in this case proposes that you convert your private limited business to an OPC. An OPC is a type of business structure that can be incorporated with just one stakeholder.
Here are the some benefit of converting Pvt Ltd to One Person Company :
A one-person business is not required to hold board or general meetings.
Due to the risks involved in being a sole proprietor, one person companies might draw interested investors.
One Person Companies draw qualified applicants to aid in the expansion of the business because they are comparable to Private Limited Companies.
The One Person Company can be formed with just one Director.
Management is simpler with a one-person company than with a private limited company.
By limiting responsibility from personal assets, it protects its shareholders in contrast to a sole proprietorship.
Filling up the share transfer form and giving it to the buyer of the shares is all that is necessary to transfer shares in a One Person Company.
The following requirements must be met before you are permitted to Private Limited to a One Person Company.
The methods below provide a full explanation of how to change a Private Limited Company into a One Person Company model:
E-Form MGT 14 The following attachments must be filed with a copy of the Special Resolution at the Registrar of Companies:
E- Form INC 6 Application for a Private Limited Company to Change to a One Person Company with the Required Attachments: