Contents
Here are the differences between about sole proprietorship and one person company registration you need to know:
Sole Proprietorship and OPC
1. Registration
- In a Proprietorship, registration of the company is Not Compulsory. A proprietor can register if he wants to register his company.
- In a One Person Company, the company can be registered under the MCA and the Companies Act 2013.
2. Legal status of an entity
- A proprietorship is not considered a separate legal entity
- A one-person company is a separate legal entity.
3. Members’ liability
- A Proprietor has Unlimited liability.
- In a one-person company, liability is limited to the extent of share capital.
4. Minimum number of members
- In a Proprietorship, there is only a Sole Proprietor.
- In a One Person Company, there is a minimum of 1 person is essential.
5. Maximum number of members
- A maximum of 1 person is allowed in a Proprietorship
- A maximum of 2 people is allowed in an OPC Registration in India.
Conclusion
Sole Proprietorship and One Person Company are very different from each other. A proprietorship is not a separate legal entity, whereas a person’s company registration is a separate legal entity. Not only this, but also varies in terms of existence as a proprietorship comes to an end, the death or retirement of the member, whereas an One Person Company’s Existence is independent of directors or nominees.