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30 Apr, 2025
By Online Legal India
Published On 25 Feb 2021
Updated On 30 Apr 2025
Category Compliance
One Person Companies (OPCs) are an excellent option for solo entrepreneurs who wish to start a business with full control, while also enjoying the benefits of a separate legal identity and limited liability. Since OPCs are legally recognized as private limited companies, they are required to comply with the rules and regulations prescribed by the Ministry of Corporate Affairs (MCA).
Just like any other registered business, OPCs have to fulfil a set of annual and event-based compliance requirements. These include proper records maintenance, return filings on time, and staying updated with statutory obligations.
In this article, we will cover all the important compliance obligations that every OPC must follow to run smoothly and stay on the right side of the law in India.
One Person Companies (OPCs) in India must follow certain annual and periodic compliance rules as per the Companies Act, 2013. These compliances help maintain transparency and ensure smooth business operations. The key requirements are mentioned below:
Every company incorporated in India is required to file the commencement of business declaration within 180 days from the date of its incorporation. This timeline is strictly enforced under the Companies Act, 2013. Failing to file within this period can attract penalties for both the company and its directors.
The primary objective of this declaration is to confirm that the company has received the entire amount of share capital as mentioned in the Memorandum of Association (MOA) from its shareholders. It serves as an official confirmation that the company has secured the necessary funding through share subscriptions and is now fully prepared to begin its business operations. Filing this declaration ensures regulatory authorities that the company is not a shell entity and has legitimate financial backing to carry out its activities.
Companies are required to pay stamp duty on share certificates within 30 days from the date of their issuance, in accordance with the applicable State Stamp Act. The share certificates must be properly stamped as per the rates prescribed by the respective state laws to ensure their legal validity and acceptance in official records.
Every company, except for a One Person Company (OPC) with a single director, is required to hold a minimum of two board meetings each year, with a mandatory gap of at least 90 days between the two meetings. This ensures regular oversight and decision-making in line with corporate governance norms.
A One Person Company (OPC) is exempt from the requirement of holding an Annual General Meeting, unlike other types of companies.
5. Director’s Disclosure of Interest
Directors are required to provide a written disclosure of their interests in the first board meeting they attend or whenever there is any change in their interest, as mandated under Section 184 of the Companies Act.
Every year, directors must submit Form DIR-8 to confirm that they are eligible to continue holding the office of director and are not disqualified under the applicable provisions.
An OPC must maintain statutory registers, including the Register of Members, Minutes Book, and other prescribed records, on an ongoing basis to comply with secretarial standards.
An OPC must file its financial statements through Form AOC-4 within 180 days from the end of the financial year, meaning the due date typically falls around September 27 if the financial year closes on March 31.
The annual return of an OPC must be filed using Form MGT-7 within 180 days from the financial year-end, and it must be signed by the director, with the assistance of a company secretary only if specifically mandated.
An OPC must file its Income Tax Return by September 30 of the assessment year, using Form ITR-6 provided that a tax audit is not applicable.
Directors are required to update and confirm their personal details with the Ministry of Corporate Affairs (MCA) by filing DIR-3 KYC by September 30 each year.
When an auditor is appointed, the company must file Form ADT-1 within 15 days of the appointment, and the auditor typically serves a term of five years unless removed earlier.
Companies having outstanding payments to MSME vendors exceeding 45 days must file MSME Form I twice a year—by October 31 for the April to September period, and by April 30 for the October to March period.
Every company that has loans or outstanding amounts, regardless of whether they are categorized as deposits, must file Form DPT-3 by June 30 each year.
After you register a One Person Company (OPC), it is important to arrange a few essential stationery items to meet legal and operational needs. These items are necessary for official communication, documentation, and compliance.
Every OPC must display its name and registered office address outside its place of business. The board should be clearly visible and either painted or affixed as per the law. This is a requirement which is enforced under the Section 12 of the Companies Act, 2013.
Two types of rubber stamps are generally used by a One Person Company (OPC). The first is a round stamp that contains the company’s name, and the second is a straight stamp that includes the company’s name along with the designation of the person signing, such as “Director” or “Authorised Signatory.”
These stamps play a crucial role in the company’s day-to-day operations. They are commonly required when signing important legal documents like board resolutions, opening a bank account in the company’s name, and issuing cheques or other financial papers.
The official letterhead of a One Person Company (OPC) should prominently display the company's name and its registered office address, ensuring effective business communication and compliance with legal transparency requirements. The letterhead should be used to issue invoices, send official letters, serve notices, and prepare other legal documents related to the company’s operations.
Important Note:
The phrase '(One Person Company)' must be placed in brackets directly below the company name wherever it appears, such as on name boards, stamps, letterheads, or similar materials.
After you register as a One Person Company (OPC), the first step is to apply for a Permanent Account Number (PAN) in the name of the company. A PAN is essential for all financial and tax-related activities of the OPC.
The PAN application can be submitted online after incorporation. After the application is processed, the system issues a PAN allotment letter. This letter must be signed by the director of the company and stamped using the company’s rubber stamp.
After you sign and stamp the allotment letter, it must be sent by courier to the NSDL (now Protean eGov Technologies Limited) Office for verification. Once NSDL receives the signed document, the PAN card is generally issued within 15 working days.
This PAN is important to open a bank account, file tax returns, and carry out any financial transactions on behalf of the company.
It is a simple process to open a bank account in the name of a One Person Company (OPC). Since an OPC is a registered corporate entity, banks do not require any additional tax registrations like in the case of sole proprietorships.
As per the KYC (Know Your Customer) guidelines issued by the Reserve Bank of India (RBI), the following documents are required to open a current account for an OPC:
Documents Required:
All the mentioned documents must be self-attested by the director and sealed with the company stamp. That is why it is important to get the company’s seal and official letterhead ready immediately after the OPC is incorporated.
Once these documents are submitted, most banks will process the request and activate the current account within a few working days.
After the registration of a One Person Company (OPC), it is mandatory to file Form 20A with the Ministry of Corporate Affairs (MCA). This form is a declaration that the OPC has received the subscription money from the shareholder and is ready to start business operations.
Form 20A should be submitted within 180 days of the incorporation date. It is required under Section 10A of the Companies Act, 2013. The purpose of this form is to confirm that the company has complied with the initial setup formalities and is now commencing its business legally.
Failure to file Form 20A within the stipulated timeline may result in penalties, and the Registrar of Companies (ROC) has the authority to remove the company’s name from the register.
If you file Form 20A on time ensures smooth business operations and helps the company stay compliant with legal requirements. It is an important early step for any OPC after incorporation.
In a One Person Company (OPC), there is usually only one Director. Even then, it is mandatory for the Director to submit the Form DIR-8 every year.
Form DIR-8 is a declaration that the Director is not disqualified from continuing in the role. This means the Director confirms they are still eligible to act as a company Director and are not barred under any provisions of the Companies Act, 2013.
This form must be submitted annually, and it helps ensure that the Director meets all legal requirements to manage the company. It is an important compliance step that promotes transparency and accountability in the company’s functioning.
Form DIR-8 filing on time helps maintain the legal standing of the OPC and avoids any non-compliance issues.
A One Person Company (OPC) must regularly maintain certain important records to stay compliant with the rules under the Companies Act, 2013. These records help prove that the company is following legal procedures and maintaining good governance.
Key Records to Maintain:
The OPC must keep updated registers such as the Register of Members, Register of Directors, Register of Charges, and any other registers as required by law. These must always be current and accurate.
The company must maintain a minute book to record details of all board meetings and any other meetings. It should include decisions, discussions, and resolutions in a proper and dated format.
This includes copies of annual returns, board resolutions, agreements, and contracts. These documents should be well-organized and available for review when needed.
It is important to maintain these records properly for legal compliance, transparency, and the smooth operation of the OPC.
Every One Person Company (OPC) must file Form AOC-4 to submit its financial statements to the Ministry of Corporate Affairs (MCA).
This form must be filed within 180 days from the end of the financial year, which is usually March 31. It includes important financial details such as the balance sheet, profit and loss statement, and other financial data required by law.
The financial statements should be prepared according to the applicable accounting standards and must be accurate and complete.
If you file Form AOC-4 on time it helps the OPC to stay legally compliant and shows that the company is financially transparent. It also allows stakeholders, investors, and authorities to assess the financial position and performance of the company.
Timely submission of this form is an important part of good corporate governance and helps build trust in the company’s operations.
A One Person Company (OPC) must file its annual return every year using Form MGT-7. This form gives a complete overview of the company’s key details for the financial year.
The annual return must be filed within 180 days from the end of the financial year, which is usually March 31. Form MGT-7 includes important information such as the shareholding pattern, details of the Director, and other basic company data.
You have to make sure all the information in the form is correct and complete. Filing this form on time is a legal requirement under the Companies Act, 2013.
Timely submission of Form MGT-7 helps maintain compliance, promotes transparency, and allows regulatory authorities and stakeholders to understand the company’s governance and operations.
Every One Person Company (OPC) must file its Income Tax Return (ITR) each year to comply with Indian tax laws. The form for OPCs is Form ITR-6.
The return must be submitted by September 30 of the financial year, unless an extension is granted by the Income Tax Department. The company must give a full report of its income, which includes earnings from business operations, investments, and any other sources.
While you file Form ITR-6, the OPC should also report any deductions, exemptions, or other tax-related details as per the provisions of the Income Tax Act, 1961.
Filing the return on time helps the OPC to avoid penalties and ensures proper compliance with income tax regulations. It also promotes the company's financial transparency and ensures proper record-keeping.
Every director of a One Person Company (OPC) must complete the DIR-3 KYC filing to keep their information updated with the Ministry of Corporate Affairs (MCA).
This KYC (Know Your Customer) process is done annually, and the deadline is September 30 of the financial year following the one in which the DIN (Director Identification Number) was allotted or last updated.
Directors are required to provide the following details in the DIR-3 KYC form:
DIR-3 KYC aims to promote transparency and ensure an up-to-date record of company directors. Even if there are no changes, the filing is still required each year.
If a director does not file the KYC within the deadline, their DIN will be deactivated by the MCA, and a penalty of Rs.5,000 will apply for reactivation.
To avoid penalties, OPC directors must complete the DIR-3 KYC process before September 30.
It helps you to stay updated with annual compliance is very important for a One Person Company (OPC). It not only ensures legal safety but also helps in the smooth growth of the business. Here are some key benefits:
When an OPC follows all its annual compliance rules, it builds trust among banks, investors, and financial institutions. This makes it easier for the Company to get loans or attract investors.
Filing returns and maintaining records on time helps the OPC keep its active status with the Ministry of Corporate Affairs (MCA). An active status means the Company is legally running and not flagged for default.
If an OPC ignores its annual compliance duties, it may face fines, late fees, or other legal problems. Regular compliance helps avoid such penalties and keeps the Company in good standing.
Conclusion
Annual Compliance for One Person Company (OPC) is not just a legal formality — it is a reflection of responsible and effective business management. Ensuring timely filings such as AOC-4 and MGT-7, maintaining statutory records, and fulfilling tax obligations are essential practices. By adhering to these compliance requirements, OPCs can maintain active status with the Ministry of Corporate Affairs (MCA), safeguard stakeholder interests, and build a foundation for long-term success.
At Online Legal India, we streamline the entire process — from OPC registration to annual compliance filing and accurate documentation management. Our expert assistance ensures your business stays compliant and stress-free.
Visit Online Legal India today to meet all your OPC compliance needs with ease and confidence.
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