Even with the epidemic looming over the entire planet, company registrations have increased dramatically in recent years. The epidemic has increased the demand for online marketplaces to buy and sell products and services.
The most recent revision to the Companies Act, passed during the 2021 Budget Session, has resulted in significant changes. With newer policies, it has aided the expansion of enterprises. The majority of newly registered businesses are one-person businesses, which are typically startups.
What exactly are one-person businesses?
One Individual Firms are defined as an enterprise with a single person under Section 2(62) of the Companies Act. The other members of a corporation are merely stockholders or subscribers to the memorandum of association.
When there is only one owner or sponsor of a business, this type of company is formed. Because of the advantages it provides, individuals who are starting a business prefer to register as a One Person Company rather than a sole proprietorship.
What adjustments have been made in favour of OPCs?
The 2021 Budget Assembly brought about a number of reforms that had an effect on the market. The modifications to the OPC Enrollment process and required compliance were one of the budget’s primary features for 2021.
The following are some of the greatest aspects of the OPC provisions:
- Previously, NRIs were not permitted to integrate OPCs; however, an individual of Indian descent is now permitted to combine an OPC.
- The meaning of residential area has been altered, with the suggested resident status period for NRIs being lowered to 120 days from 182 days.
- Just an individual of Indian origin may be nominated as the sole employee of a One Small Firm, and no one may begin or become the contender of another OPC.
- Juveniles are not eligible to participate in OPC in any way. This is prohibited by Section 8 of the Act.
- Businesses with minors are not permitted to engage in Non-Banking Financial Capital investments, such as investing in the shares of any corporation.
What are the benefits of one-person businesses?
OPCs in India receive a number of advantages. These advantages are the outcome of the most recent changes to the Companies Act. The following are some of the perks and exclusions granted by the Companies Act:
- It is not necessary to clutch the AGM.
- Working capital does not need to be included in the income report.
- The company secretary is not required to sign the average growth because the executives can do so as well.
- They are not covered by the provisions for independent directors.
- There is space for more grounds to vacate the director’s office.
This is one of the characteristics, among many others, that are available to OPCs.
One of the most notable aspects of the recent Budget discussion has been OPCs. The goal was to encourage the creation of fresh and smaller businesses in order to boost the economy. To set up an OPC, you must first learn the fundamentals of OPC.