[feb]one-person companies

Question 1

what?

Answer 1

company that can be formed by just one person as ashareholder. These companies can be contrasted withprivate companies, which require a minimum of twomembers to get going. However, for all practical purposes, these are like private companies.

Question 2

Need for these companies?

Answer 2

single-person company : person and the company are considered separate legal entities

sole proprietorship : owner and the business are considered the same.`

Question 3

Is this a new idea?

Answer 3

introduced in the Companies Act of 2013.

introduction was based on the suggestions of the J.J. Irani Committee Report,2005.

law on one-person companies that took shape, as a result, exempted such companies from many procedural requirements, and, in some cases, provided relaxations.

Question 4

What has changed for these companies with the new measures in this year’s Budget?

Answer 4

• The capital base limit has been increased from ₹ 50 lakh to₹ 2 crore, and the turnover limit for last 3 years has been increased from₹ 2 crore to ₹20 crore
• reducing the residency limit for an Indian citizen to set up an OPC from 182 days to 120 days and also allow non-resident Indians (NRIs) to incorporate OPCs in India.

Question 5

Public company & private company

Answer 5

Public company needs 3 directors & min. 7 members

Private company needs min. 2 directors & 2 members