A contractor agreement does two jobs at once: it sets out the commercial terms, and it documents the working relationship for IR35 purposes. The clauses below — substitution, control, mutuality of obligation — aren't padding; they're the specific evidence HMRC looks at if the engagement is challenged. Get them right and the agreement is short.
Direct answer
Engaging a freelancer or contractor in the UK? This template covers the basics — services, fees, IP, liability — and is written with IR35 'outside' status in mind.
Contractor services agreement
Section 01
The IR35 essentials baked into this template
- Substitution clause — the contractor can send someone else (the strongest IR35 indicator).
- Control language — the contractor decides how the work is done.
- No mutuality of obligation — no guaranteed ongoing work, no obligation to accept it.
- No employee benefits — no holiday pay, sick pay, pension or notice equivalents.
- Right to work for others — confirms the contractor is in business on their own account.
Section 02
What to fill in before signing
- Schedule 1 — describe the services and deliverables in specific terms.
- Fee structure — day rate, hourly or fixed fee with payment terms.
- Insurance limits — match what the contractor actually holds (most freelancers carry £1m PI and £1m PL).
- Termination notice — 30 days is normal; shorter for short engagements.
Section 03
When to upgrade to a longer form
Use a bespoke agreement (drafted by a lawyer) when: the engagement is over £100k, involves regulated activity, requires complex IP assignments, or the contractor will be on-site at customer premises. A £400 solicitor review is cheap insurance on a £150k contract.
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