Contract template for software freelancers
For software freelancers, it is absolutely necessary to sign a contract with the client. The importance of a thorough and explicit contract and agreeing on the project details such as schedule, hourly rate and payment period cannot be overemphasized – contract ensures that both parties understand the details of the work to be done and protects the entrepreneur from disagreements during and after the project.
The contract must include
Introduction is to explain the purpose of the contract as clearly as possible. Give also a brief description of the contract’s or project’s background, and explain the parties of the contract; who will work at which company. It may also make sense to describe all the designations used of the parties in the contract.
This paragraph is to prevent misunderstandings and disagreements. If the work to be done involves more tasks or you want to make the contract more open, you can use bullet points.
Describe in detail what you are expected to produce and deliver to the customer. This protects you from situations where the client suddenly asks you to do different tasks or more work than agreed. If the task is not specifically agreed in the contract, do not do it. All additional work must be agreed separately.
Explain what the contract means but also what it does not mean if there are some gray areas that could lead to misunderstandings.
Include a separate section for possible changes. You can use this section in the situation we just described, where the client asks you to do new tasks or more work than agreed.
In this section, describe how you’ll bill for changes and that you expect the customer to pay for work that has already been done.
You can put both your own notes and the customer’s comments to this part of the contract. Give the client a chance to tell what they expect from you and the work to be delivered. This way you’ll show that you are cooperative and take the customer’s needs and wishes into account.
When will the project start and when it is expected to end?
We also recommend writing down the number of hours the work is expected to take you. This is to avoid a situation where the project is taking longer than the customer has agreed to pay you. Also, writing down the time estimation will ensure that you’ll receive a reasonable compensation for your work, regardless if it’s a fixed amount for the entire project or hourly rate based.
As an entrepreneur, you should play safe and not take a risk with the customer misunderstanding the payment details and cost of your work.
Write down the hourly rate or a fixed amount for the entire project, how the payment will be carried out and when the invoice sent by you will be due (payment period). Also describe the rate of interest that will be charged if the invoice is not paid on time.
If you have agreed that the project will be paid for in several installments after each completed phase, describe in detail when you’ll invoice the customer and what the payment period is.
In this section, provide any other important information that affects your work or the collaboration between you and the client. Such information may be, for example, who owns the content that you produce, who has the rights to use the content, confidential content, responsibilities and insurance.
Define two parts to be signed; one for yourself and one for the customer. Contract is a written agreement between two or, in some cases, more parties, and it’s important that all parties sign it.
By including these eight points you’ll ensure that both parties understand the details of the work to be done and avoid disagreements about them during and after the project.
Here is a contract template that we at Witted use when our clients purchase subcontracting from software freelancers working through Witted. You’ll be able to edit the document by making a copy of it first.
The contract template is generalized and it’s easy to make additions on a case-by-case basis. However, it is not directly usable as a contract between a software freelancer and a client yet we strongly believe that you can still get tips from it.
Witted Partners makes becoming a software freelancer easy
Setting up a company – We’ll plan the start together with you so that there is no break in the billed work. We can start looking for projects for you even if you haven’t established a company yet or are still employed. Setting up a company is fast and easy nowadays, and there’s no rush with it; we can do it together when you’ve found your first project.
Customer acquisition – Don’t waste billable hours on the lookout for projects, our agents will handle customer acquisition for you! You set your own terms, such as hourly rate and the specs of your ideal project (industry, technologies, duration). Our agents will search for suitable projects for you accordingly.
Running the company – There are over 2500 Nordic software freelancers in our community, and they have recommended several accountants, insurances and tools for fellow independent contractors. We will gladly pass on the tips so that your journey as an entrepreneur would start smoothly.
Becoming an entrepreneur
- How much could you make as a software freelancer?
- Why become a software freelancer?
- Five steps to becoming a software freelancer
- FAQ: Becoming a software freelancer in Finland
After starting a business
Running a business