One Person Company (OPC) has been recently introduced in India. This led promote business enterprises that are owned by an individual business mind. Corporate entities such as Private Limited Company, Limited Company and Limited Liability Partnership which requires two or more people to partner. One Person Company is believed to be a viable option for those looking to give a start an unregistered proprietorship. Generally, OPC allows for a single individual to own and manage the business. In this article, we will be comparing the impact of One Person Company vs. Private Limited Company in India.

One Person Company vs Private Limited Company

Cost Registration

The cost for registration of One Person Company is comparatively lower than the value of registration for a Private Limited Company. The One Person Company holds a cost registration of Rs.15000 through whereas, the whole cost for registration of Private Limited Company is worth Rs. 16000 through

Number of People Required to Incorporate

One Person Company officially requires two people. The Director of the One Person Company and Nominee Director. The Nominee Director works as an associate, while in cases if Director failed to execute the functions, the nominee director is responsible for uplifting the management work.

Board of Directors

An individual handles one Person Company; a single person manages the position of Board of Director. The concept of Annual General Meeting and Board Meetings is also not applicable for a One Person Company. A Private Limited Company owns a minimum of two directors and a maximum of seven directors.


A single person can hold the 100% shares of a One Person Company. According to the officials, a private limited company must have a minimum of two shareholders. Therefore, 100% of the shares of a private limited company cannot be held by a single person.

NRI or Foreign Nationals

To start One Person Company, the owners should be India citizens and Indian Nationals. A private limited company can be started and managed by NRIs and Foreign Nationals.

Compliance Requirements

The compliance requirements of both One Person Company and Private Limited Company are almost similar. Both, One Person Company and Private Limited are required to file their annual returns with the Ministry of Corporate Affairs and their income tax returns with the Income Tax Department. Every year, both One Person Company and Private Limited Company are required to get their account audited.


If the annual sales turnover exceeds Rs. 2.00 crores or the paid-up capital of the One Person Company exceeds Rs. 50 Lakhs a One Person Company must be mandatorily converted into a Private Limited Company. A private limited company holds no such limitations and no requirement for mandatory conversion under any circumstances.

Post Incorporation

One Person Company has been recently introduced in India, government departments and banks have not updated their systems or forms and procedures to handle One Person Company. Thus, there may pop up with some difficulties and errors in obtaining certain licenses or registration after incorporation of a One Person Company.

Private Limited Company is an old player in the industry and is the most popular type of corporate entity in India. Therefore, the process for obtaining other licenses and registration, post incorporation of a private limited company might sound a bit easy.

Conclusion for One Person Company vs Private Limited Company

One Person Company and Private Limited Company seem a little similar many sectors such as the cost of incorporation, compliance, and a number of a person required to incorporate. However, when it comes to limitations, One Person Company has a lot more new things on limiting foreign promoter participation, mandatory conversion to private limited company, etc. Entrepreneurs incorporate a Private Limited Company instead of a One Person Company until the concept of One Person Company is well established and reputed in India.