Question 1

How is an OPC taxed?

Accepted Answer

An OPC under Section 2(62) of the Companies Act 2013 is taxed identically to a private limited company — ITR-6, subject to MAT under Section 115JB, and eligible for the Section 115BAA concessional rate of 22% (effective 25.168% with surcharge and cess).

Question 2

Can the sole director-member deduct salary?

Accepted Answer

Yes — remuneration paid to the sole director is deductible in the OPC's hands under Section 37(1), provided it is commensurate with services rendered. Unlike partners in a firm, there is no statutory cap on director remuneration in a private company. The remuneration is taxable in the director's hands as salary under Section 15, subject to TDS under Section 192.

Question 3

When must an OPC mandatorily convert?

Accepted Answer

Under Rule 6 of the Companies (Incorporation) Rules 2014, an OPC must convert when paid-up capital exceeds ₹50 lakh or average annual turnover for the preceding 3 years exceeds ₹2 crore. Conversion is via Form INC-6 — the tax profile does not change on conversion since both OPC and Pvt Ltd are assessed under the same corporate tax rules.

Question 4

What is the advance tax obligation for an OPC?

Accepted Answer

Same as any domestic company — Section 208 requires advance tax if liability exceeds ₹10,000, paid in four instalments (15% by 15 June, 45% by 15 September, 75% by 15 December, 100% by 15 March). Interest under Section 234B and 234C applies on shortfalls.

Question 5

What ROC filings interact with the OPC's tax filings?

Accepted Answer

The OPC must file Form AOC-4 (financial statements) within 180 days of the close of the financial year (a special grace period vs. 60 days for other companies) and Form MGT-7A (annual return) by 27 September. The CA coordinates the statutory audit, ROC filing, and ITR-6 together to use the same set of audited financials.

Itr Opc

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