Annual Compliance for OPC

One Person Company means a company that is wholly managed and controlled by a single person. The management of OPC comprises only one person which consists of 100% of shares in that company. All the important decisions related to OPC are taken by the director itself. Section 2(62) of the Companies Act 2013, defines OPC as a company that has only one person as a member. In India, OPC can be registered only as a Private Limited Company. Thus all the legal provisions which are applicable to Private Limited Company are also applicable on OPC. A Private Limited Company needs to comply with some statutory compliances under the Companies Act, 2013, similarly there are some provisions for Annual Compliance for OPC which needs to comply with every year. Hence ROC Filing for One person Company (OPC) is mandatory. In this article, we discuss the Annual compliance checklist for OPC.

7 OPC Annual Compliances Checklist Don't Miss 

OPC is under obligation to undergo some yearly annual compliances, failure of which may attract some penalties as per the Companies Act, 2013. Annual compliance for OPC can be divided into 3 Parts.

1. OPC Statutory Audit

2. OPC Income Tax Return Filing

3. OPC Annual ROC Filing

1.  Board Meeting

As per the provisions of Sec 173 of the Companies Act, 2013 at least one meeting of the Board of Directors shall be conducted in every 6 months, and the gap between the two meetings is not less than 90 days. Thus an OPC should conduct a minimum of two board meetings every year. Section 173 and 174 (Quorum of Meeting of BoD) will not apply to an OPC in which there is only one director on its Board.

2.  Appointment of Auditor

Under Section 139 of Company Act, 2013 Auditor Appointment is compulsory for One Person Company. OPS Shall get its books of accounts audited by Chartered Accountant firm. The auditor shall verify books of account and issue a Statutory audit report. Provision relating to rotation of auditor is not applicable to OPC.

3. Disclosure of Interest in Other Entities

In each financial year, every director of OPC in its first meeting of the Board of directors need to disclose his interest in other entities in form MBP-1 pursuit to sec 184 of the Companies Act, 2013. Under OPC ROC Annual filing disclosure need to be submitted. 

4. ROC Filling of Annual Return

OPC will file its ROC Annual Return within 60 days of entry of ordinary resolution in Minute Book. Annual Return will be for the period 1st April to 31st March in form MGT-7.

Penalty: The penalty is Rs 100/- per day.

1. Each key member of the company and who is in default shall be deemed for paying the penalty of Rs. 50,000 and also the late fee of Rs. 100 per day if the default continues.

2. The penalty is subject to a maximum of Rs. 5,00,000

5.  OPC Statutory Audit

Unlike Private Limited Company, OPC is required to get its books of accounts audited by Chartered Accountant firm. OPC shall maintain its books of account at its registered office. Under OPC Statutory Audit, CA Firm shall issue audit report certification. Form AOC 4 is used by OPC to file their annual financial statements to ROC. Attachment to AOC 4 is below.

1. Balance Sheet

2. Statement of Profit & Loss Account

3. Directors’ Report

4. Auditors’ Report and Notice of AGM.

Penalty: A penalty of Rs 100 per day on delay in filing Form AOC.

6. KYC of Director of the company:

Every person who holds DIN/DPIN as of 31st March of the financial year has to submit Form DIR-3-KYC or DIR-3 KYC-WEB for the said financial year on or before 30th September of the immediate next financial year.

eForm DIR-3 KYC is to be filed by an individual who holds DIN and is filing his KYC details for the first time or by the DIN holder who has already filed his KYC once in eform DIR-3 KYC but wants to update his details.

Web service DIR-3-KYC-WEB is to be used by the DIN holder who has submitted the DIR-3 KYC eform in the previous financial year and no update is required in his details.

Penalty: Rs, 5000/-

Read About DIN KYC Filing 

7. Filling of Income Tax Returns:

As per Section 139(1) of Income Tax Act 1961 Any private, public, domestic or foreign country located and/or doing business in India is liable for Income Tax Return (ITR) Filing. Every OPC registered in India is required to file an annual income tax return. Income tax filing is mandatory even if OPC has No Transactions. For FY 2020-21 income tax return filing, the due date for OPC  is 30 September  2021

Penalty: For OPC Income Tax Non-filing late filing fees up to Rs. 10000/- shall be applicable. 

Read About Income Tax Rate on OPC

OPC annual filing Due Date:

An OPC is required to comply with the annual filling within the due dates as follows to avoid heavy penalties i. e Rs 100 per day

Conclusion

OPC is under obligation to submit annual reports. OPC Annual compliance may include Auditor appointments, statutory auditing, annual ROC filing, DIN KYC of director and Income Tax filing. Apart from this TDS Filing, GST Filing, PF Filing etc. compliances may be applicable to OCP on certain conditions. Furthermore, it is important for One Person Company to maintain the OPC compliance with the Companies Act as well as the Income Tax Act, and other regulations if applicable.

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Posted by Twinkle

Team Taxaj