Entity guide · FY 2026-27 · India
One Person Company (OPC)
Single-founder corporate shell with full limited-liability protection. Companies Act, 2013 — Section 2(62) read with Section 3(1)(c); incorporated via SPICe+.
Headline facts
Incorporation cost
₹10,000–25,000
Typical timeline
10–15 working days
Tax regime (FY 2026-27)
Base 25% (turnover ≤ ₹400 Cr), optional 22% under Section 115BAA, grandfathered 15% under 115BAB. Surcharge and cess apply.
FDI eligible
No (OPC prohibited from FDI under Schedule I of FEMA NDI Rules 2019)
Typical revenue band
₹25 lakh–₹2 crore
Audit requirement
Statutory audit under Section 139 mandatory every year regardless of turnover. Tax audit under 44AB applies independently.
Who OPC is best for
- A solo founder who wants Pvt Ltd-style credibility without a token second shareholder.
- A professional who has outgrown proprietor status but doesn't want to dilute yet.
- A consultant who wants to ring-fence personal assets behind a corporate shield.
- A future Pvt Ltd — using OPC as a one-to-two-year bridge before external investment.
Who should NOT choose OPC
- NRIs, foreign citizens, or foreign-backed teams.
- Any venture seeking FDI or foreign directors.
- Two or more co-founders — a Pvt Ltd with two shareholders is cleaner.
Pros & Cons
Pros
- Solo founders get a fully-incorporated company with limited liability.
- Perpetual succession via the nominee clause — business continues on member's death.
- Eligible for 22% Section 115BAA rate vs 30% for individuals and LLPs.
- 'Pvt Ltd' suffix opens vendor and banking doors that proprietors struggle with.
- Single-member decision-making means no deadlock risk.
- No mandatory conversion threshold since the 2021 amendment.
Cons
- Only resident Indian citizens can incorporate or be nominee — NRIs and foreign nationals excluded.
- FDI prohibited — external equity impossible without first converting to Pvt Ltd.
- Statutory audit mandatory from year one regardless of turnover.
- ESOPs theoretically possible but practically pointless with a single member.
- A person cannot hold more than one OPC or be nominee in more than one.
- Minimum two directors required the moment conversion to Pvt Ltd is initiated.
Annual compliance
Filing forms: AOC-4 within 180 days of FY-end, MGT-7A within 60 days of AGM-due, ADT-1, DIR-3 KYC, ITR-6, plus GST and TDS.
Statutory audit from day one, AOC-4 and MGT-7A with ROC, ADT-1, DIR-3 KYC for the director, ITR-6, plus GST and TDS. No AGM required; Section 173 board meetings simplified to one per half-calendar-year with 90-day minimum gap.
Conversion pathways
Pvt Ltd (voluntary any time under Rule 6 of Companies (Incorporation) Rules 2014 post-2021 amendment), Public Ltd (after conversion to Pvt Ltd first)
Our team's take
OPC is where our team has developed strong professional scepticism. Founders choose it because marketing positions it as 'Pvt Ltd for solopreneurs,' but in practice the framework is narrower in ways that matter — no NBFC activities, nominee formality that's legally binding, and ESOP limitations. The cleaner choice for most solo founders is either a proprietorship (maximum flexibility) or a Pvt Ltd with a trusted second shareholder holding a nominal stake. OPC is a narrow-fit form; verify the fit specifically, don't default to it.
— CA Siddharth A Shah & Associates · FRN 157167W
Not sure OPC is right for you?
Take our two-minute entity chooser to see how OPC scores against the other five forms for your specific situation.
Browse other entity guides
Disclaimer
This tool provides general informational guidance on Indian business entity structures for FY 2026-27 and does not constitute professional advice, an engagement with CA Siddharth A Shah & Associates, or a substitute for personalised consultation with a qualified Chartered Accountant. Recommendations are based on the inputs you provide and may not address your complete legal, tax, or regulatory position.
© CA Siddharth A Shah & Associates · Chartered Accountants · FRN 157167W · Vadodara, Gujarat