What is the Difference between an OPC and Proprietorship?


What is the Difference between an OPC and Proprietorship?

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There are many different ways in which businesses can be organized in India. Some of the most common business structures include Sole Proprietorship, One Person Company, and Private Limited Companies. Each has its own merits and demerits. Choosing the right structure for your business is crucial to its growth and success. This article will compare the OPC and Proprietorship form of business to help you determine which the best is for you.

A Sole Proprietorship and OPC are two different types of business structures available to entrepreneurs. Sole proprietorship is the simplest and most common form of business in India. It is an individual ownership structure where the owner is responsible for all liabilities associated with the business. In a sole proprietorship, there is no legal distinction between the business and the owner; the two are considered to be the same entity. Sole proprietorships are typically not required to be registered or incorporated, but they may choose to do so in order to gain access to various financial institutions for funding.

One Person Company is a new concept introduced by the Companies Act, 2013 that allows individuals to combine the benefits of a Sole Proprietorship and a Private Limited Company. It offers a number of perks to entrepreneurs, such as perpetual succession and fewer compliance requirements than a private limited company.

A one person company can have only one shareholder as its member, and it can be a natural or corporate body. It can also be converted into a private limited company or a different type of incorporation at any time, provided it meets the necessary compliances.

 

 

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