What is the difference between an OPC company and Proprietorship Company?



What is the difference between an OPC company and Proprietorship Company?

"Call Our Business Plan Experts at +91-72999-72500"

Choosing the right legal structure is one of the most important decisions for entrepreneurs. It can affect various aspects of the business including taxation, liability, and growth potential. In this article, we will compare the difference between an OPC and Proprietorship to help you select the right business entity for your venture.

An difference between OPC and Proprietorship Incorporating an OPC makes the business a separate legal entity, with its own assets and debt. Sole Proprietorship is the simplest form of business ownership in which an individual owns and operates his/her own business. There is no legal distinction between the owner and the business, and the owner assumes all liabilities associated with the business. The owner's personal assets are at risk if the business experiences losses.

OPC (One Person Company) is a type of private company that has only one shareholder/member. It is similar to a sole proprietorship in terms of operation and management, however, it offers some key benefits such as:

Limited Liability – As the OPC has a separate juridical personality from its member, the member's liability is limited to their capital contribution/assets. In comparison, a sole proprietorship has unlimited liability.

Perpetual Succession – An OPC has a mandatory provision to have a nominee that will take over the company operations in case of the death of its member. In comparison, a sole proprietorship will lose its business license upon the death of its owner.

Taxation – OPC is taxed as a private company and can claim certain income deductions like employee salary, office rent, business expenses etc. In comparison, a sole proprietorship is taxed at 8% of gross sales/receipts as individual income.

 


Comments

Post a Comment

Popular posts from this blog

The Consultant's Checklist for Registering Your Software Company

Image
Call Our Experts for Software Company Registration at +91 72999 72500 Introduction: Navigating the process of registering your software company   in  Karakudi - Sivagangai  requires careful planning and understanding of legal requirements. FilingPoint offers a comprehensive checklist tailored for consultants, ensuring a seamless start for your business. From choosing the right legal structure to tax registrations, our expert guidance simplifies the complexities of starting a software company.   The Consultant's Checklist for Registering Your Software Company   The first step in preparing for your consulting business is to identify your niche within the industry. Then you should assess your strengths and weaknesses as a consultant in order to determine what type of client to target. You will also need to establish the type of services that you are capable of providing and decide how long you want to offer these services for.   Once you'...
Read more

25 Low-Cost Small Business Ideas for Company Registration in India

Image
25 Low-Cost Small Business Ideas for Company Registration in India? "Call Our Business Plan Experts at +91-72999-72500" You can start a business that repairs and maintains vehicles. It's one of the best small business ideas for beginners. Get a mechanic certification, purchase tools and a van to transport vehicles to and from client's homes. These ideas include service-based businesses and those that require a minimal amount of start-up capital. You can even start a business from home with these  25 low-cost Small Business ideas . Automotive Service Getting into automotive service is one of the best small business ideas, especially in metro cities. You can start a company that provides taxi services at affordable rates. You can purchase vehicles suitable for the purpose at auction sites and get them fitted with taxi meters and your brand name. You can also distribute flyers and brochures to spread the word about your automotive service busin...
Read more

Essential Licenses and Permits Required to Start a Business in Chennai

Image
Call our experts for consultants at +91 72999 72500 Introduction: Starting a business in Chennai , a bustling economic hub in India, requires navigating a complex landscape of licenses and permits to ensure compliance with local, state, and national regulations. From basic registrations to industry-specific approvals, entrepreneurs must secure the necessary documentation to operate legally and avoid potential legal pitfalls. Filingpoint, a trusted name in business consultancy, provides comprehensive assistance in obtaining these essential licenses and permits. This guide will outline the key requirements and the process involved, offering a clear roadmap for aspiring business owners in Chennai.   Essential Licenses and Permits Required to Start a Business in Chennai   Starting and operating a business in a city like Chennai can seem intimidating. The licensing process is regulated by the city and state government. It includes various registrations, documentation, v...
Read more