OPC to private limited conversion process and conversion of one person company to private company
- Corpzo Ventures Private Limited
- 20 hours ago
- 4 min read
n India, a One Person Company (OPC) is a suitable business structure for small-scale entrepreneurs who want to operate as a separate legal entity without involving multiple shareholders. However, as the business grows, many OPCs opt for conversion into a Private Limited Company to take advantage of expanded funding options, increased credibility, and regulatory flexibility. Corpzo offers expert assistance in the OPC to Private Limited conversion process and ensures smooth compliance with legal requirements.
Expansion Opportunities – A Private Limited Company can have multiple shareholders and directors, allowing for scalability.
Increased Funding Options – A Private Limited Company can raise capital from investors, venture capitalists, and banks.
Limited Liability Protection – Shareholders’ liability is limited to their investment in the company.
Better Market Reputation – A Private Limited Company enjoys greater credibility in the market compared to an OPC.
Compliance with Regulatory Requirements – If an OPC exceeds the prescribed turnover of INR 2 crores or has a paid-up capital of more than INR 50 lakhs, conversion to a Private Limited Company becomes mandatory.
Process of OPC to Private Limited Company Conversion
The conversion process involves various steps, documentation, and approvals. Below is a step-by-step guide to converting an OPC into a Private Limited Company:
Step 1: Board Meeting Resolution
The first step in the conversion process is convening a board meeting to discuss the proposal for conversion. A resolution must be passed to approve the conversion and authorize a director to carry out the necessary formalities.
Step 2: Obtaining Shareholder Approval
Since OPCs have a single shareholder, the individual must provide written consent for the conversion.
Step 3: Amendment of Memorandum and Articles of Association (MoA & AoA)
To reflect the change in company structure, the MoA and AoA need to be altered to accommodate the Private Limited Company format.
Step 4: Filing of Application with ROC
The company must file Form INC-6 with the Registrar of Companies (ROC) to apply for the conversion. The following documents must be attached:
Certified true copy of the Board Resolution
Altered MoA and AoA
NOC from Creditors (if any)
Declaration by the Director (Form INC-9)
List of proposed directors and shareholders
PAN and Aadhaar of the new shareholders and directors
Step 5: Approval from ROC
Upon verification of the submitted documents, the ROC will approve the application and issue a fresh Certificate of Incorporation, reflecting the change from OPC to Private Limited Company.
Step 6: Compliance with Post-Conversion Formalities
After receiving approval from the ROC, the company must:
Update the bank details and PAN
Notify concerned authorities such as GST, Income Tax, and other regulatory bodies
Issue fresh share certificates to the new shareholders
Hold the first board meeting of the Private Limited Company
As per Section 18 of the Companies Act, 2013, an OPC can be converted into a Private Limited Company under the following conditions:
Voluntary Conversion – The OPC voluntarily applies for conversion after fulfilling the minimum requirements.
Mandatory Conversion – If the OPC has a paid-up share capital of more than INR 50 lakhs or an annual turnover exceeding INR 2 crores for three consecutive financial years, conversion becomes compulsory.
Key Benefits of Converting OPC to Private Limited Company
Enhanced Fundraising Ability – Unlike OPCs, Private Limited Companies can raise funds through venture capital, private equity, and angel investors.
Broader Management Scope – The presence of multiple directors allows for better decision-making and expertise.
Improved Credibility – Private Limited Companies are more recognized and trusted by clients, investors, and financial institutions.
Tax Benefits – A Private Limited Company enjoys certain tax deductions that may not be available to OPCs.
Employee Stock Options (ESOPs) – Private Limited Companies can issue ESOPs to attract and retain skilled employees.
PAN and Aadhaar of the director and shareholder(s)
Digital Signature Certificate (DSC) and Director Identification Number (DIN)
Updated MoA and AoA
NOC from creditors and financial institutions
Declaration of compliance by the director
Timeline and Cost for Conversion
Processing Time: The conversion process typically takes 15-25 working days, depending on the document verification by the ROC.
Government and Professional Fees: The cost of conversion varies based on state ROC charges, professional fees, and documentation expenses. On average, it ranges between INR 15,000 – INR 30,000.
Why Choose Corpzo for OPC to Private Limited Conversion?
At Corpzo, we specialize in company registrations, legal compliance, and business structuring. Here’s why you should choose us:
Expert Consultation: Our team of professionals guides you through the entire conversion process with ease.
End-to-End Support: From document preparation to ROC approval, we handle all formalities.
Time Efficiency: We ensure quick processing and hassle-free documentation.
Affordable Pricing: Transparent pricing with no hidden costs.
Post-Conversion Assistance: We assist in tax registrations, GST compliance, and financial structuring.
Conclusion
Converting an OPC into a Private Limited Company is a strategic move for businesses aiming for growth and expansion. With Corpzo’s expertise, the conversion process becomes seamless, ensuring compliance with legal requirements and helping businesses scale to new heights. Whether it’s document preparation, regulatory approvals, or post-conversion formalities, Corpzo provides comprehensive support to entrepreneurs. Contact us today for hassle-free OPC to Private Limited Company conversion services in India!
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