How To Convert One Person Company to Private limited Company in 2018

Introduction of “One Person Company” into legal system is a very encouraging move for entrepreneur, wanting to enter into a corporate world. This won’t just empower singular abilities to contribute monetary development, additionally create business opportunity. In the old Companies act 1956 at least two chiefs and shareholders were required to frame a private constrained organization. However if there should be an occurrence of a One individual organization, just 1 individual is required who can be a shareholder and also the Director.

One Person Company

Consequently the name, One Person Company (OPC).  The concept of OPC is still in its nascent stages in India and it would require some more time to reach its maturity stage and to be fully accepted by the business world. With passage of time, the OPC mode of business organization is all set to become the most preferred form of business organization especially for small entrepreneurs.

The advantages radiating from this idea are numerous, to give some examples 

  • Minimum paper work and compliance’s.
  • Skill to shape a different lawful element with only one part.
  • Provision for change to various sorts of legal components by prompting of more people and remedy in the Memorandum of Association.

One most imperative element of OPC is that the dangers alleviated are constrained to the degree of the estimation of shares held by such individual in the organization.

A One Person Company changes over itself into a Private Limited Company under two circumstances:

  1. Willful change of OPC to Private Limited.
  2. Obligatory Conversion of OPC to Private Limited.


At the point when a One Person Company gets joined, it can’t change over itself to Private or Public organization for a time of at least two years from the date of consolidation. In the event that the time period has passed and two years time period is more than, a One Person Company can apply for changing over itself to Private Limited Company or Public constrained organization. The Conversion procedure ought to be done according to the standards and regulations set around the Companies Act, 2013 under Section 18, and Rule 7(4) of the Companies (Incorporation) Rules, 2014.


At the point when a One Person Company paid-up capital exceeds Rs. 50 lakhs or the Annual turnover for the significant budgetary year surpasses Rs. 2 crore, then in such conditions, the organization needs to obligatorily change over itself into Private Limited Company or Public Limited Company according to the Rule 7(4) of the Companies (Incorporation) Rules, 2014.


This is an idea that is required to give huge driving force to Corporatization in the nation. The main consideration to be taken is that there ought to be no administrative wreckage ups like the ones which hampered the development of Limited Liability Partnerships in this nation. Generally the standards encircled so far regarding One Person Company have been exceptionally sensible.

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