Difference Between Private Limited and OPC
One Person Company and Private Limited Company
OPC and Private Limited Company are two different business structures governed by the Companies Act. The concept of One Person Company encourages single and enthusiastic entrepreneurs to operate own venture. However, Private Limited Company requires two persons to incorporate the company.
Do you want to start a new business but have confusion as to what structure of company you should choose? This article might help you to ease your decision.
What is the meaning of OPC and Pvt Ltd Co.?
One Person Company means a Company which has only one person as its member. An OPC is effectively a company that has only one shareholder as its member.
A Private Limited Company is the form of the company where minimum two members are required and maximum number of members can be 200. The liability of the members of a Private Limited Company is limited to the amount of shares held by them.
Comparison between OPC and Private Limited Company
There are few similarities as well as a few differences between the OPC and Pvt. Ltd. Co. Let us discuss both here for your better understanding.
Similarities Between OPC and Pvt. Ltd. Co.
- Separate Legal Entity: Both of them have separate legal entity. That means OPC or Private Ltd Co. is treated as a different individual in the eyes of law.
- Benefits on taxes: To the both types of business structures tax benefits are given. The tax benefits would be 25% from the profits.
- Limited Liability: In case of OPC the Sole owner and in case of Pvt. Ltd. Co. the shareholders have limited liability to the extent of their shares.
- Registration Process: Both the companies are required to be registered with the Ministry of Corporate Affairs.
OPC and Private Limited Company – Quick Comparison Table
| Particulars | OPC | Pvt. Ltd. CO. |
| Law Applicable | Companies Act 2013 | Companies Act 2013 |
| Minimum share capital | No requirement for minimum share capital. If capital exceeds 50 lakhs, opc gets converted to Pvt. Ltd. | No requirement for minimum share capital |
| Members required | Minimum one Maximum one | Minimum two Maximum up to 200 |
| Directors required | Minimum one Maximum 15 | Minimum two Maximum 15 |
| Board meeting | One meeting in each half of the year. The gap between the two meetings must be at least 90 days | One meeting in each quarter of the year. The maximum gap between the two meetings can be 120 days |
| Statutory Audit | Compulsory | Compulsory |
| Annual Filing | Financial Statements and Annual returns to be filed with registrar | Annual accounts and Annual returns to be filed with RoC |
| Liability | Limited | Limited |
| Transferability of shares | Can be made by altering MOA | Can be easily transferred |
| Foreign Direct Investment | Not eligible for FDI | Eligible via automatic route |
| Suitable to which type | Individuals whose capital requirements are 50 lakhs and turnover is less than 2 crs | Business, trade, manufacturers, large industrial establishments |
| Company Name | Should end with (OPC) Pvt. Ltd./ (OPC) Ltd. | Should end with Pvt. Ltd. |
Created & Posted By Kiran
Marketing Expert at TAXAJ
TAXAJ is a consortium of CA, CS, Advocates & Professionals from specific fields to provide you a One Stop Solution for all your Business, Financial, Taxation & Legal Matters under One Roof. Some of them are:
Launch Your Start-Up Company/Business,
Trademark & Brand Registration,
Digital Marketing,
E-Stamp Paper Online,
Closure of Business,
Legal Services,
Payroll Services, etc. For any further queries related to this or anything else visit
TAXAJ
TAXAJ Corporate Services LLP
Address: 1/11, 1st Floor, Sulahkul Vihar, Old Palam Road, Dwarka, Delhi-110078
Related Articles
Is One Person Company A Private Company
OPC and Private Limited Company are two different business structures governed by the Companies Act. The concept of One Person Company encourages single and enthusiastic entrepreneurs to operate own venture. However, Private Limited Company requires ...
One Person Company Meaning & Advantages
A new concept has been introduced in the Company’s Act 2013, about the One Person Company (OPC). In a Private Company, a minimum of 2 Directors and 2 Members are required whereas in a Public Company, a minimum of 3 Directors and a minimum of 7 ...
Special Characteristics of OPC Pvt Ltd
Features of One Person Company Member of the Company · First and foremost is that the company shall have only one member. Member is defined as a shareholder or a person who agrees in writing to become a shareholder or the subscriber of MoA who has ...
Characteristics of One Person Private Limited Company
Features of One Person Company Member of the Company · First and foremost is that the company shall have only one member. Member is defined as a shareholder or a person who agrees in writing to become a shareholder or the subscriber of MoA who has ...
How To Register One Person Company
A new concept has been introduced in the Company’s Act 2013, about the One Person Company (OPC). In a Private Company, a minimum of 2 Directors and 2 Members are required whereas in a Public Company, a minimum of 3 Directors and a minimum of 7 ...