Freelance Software Developer's Contract
This Freelance Software Developer's Agreement has been designed for use by an individual freelance software developer contracting personally to provide his services to a business client.
The data protection provisions in this document have been updated with reference to the UK GDPR.
The Data Protection provisions in the document reflect data protection law requirements. One of those provisions refers to a Privacy Notice available on request. You might wish to use the standard Privacy Notice for this purpose: you can find it by clicking here .
The accompanying Freelance Software Developer's Agreement template is to be used instead by the software developer when he contracts through his personal service (or other intermediary) company rather than directly. (The information page with that template includes guidance about tax, employment status, IR35 and agency workers, where an intermediary company is used).
This agreement aims to reduce the risk that the freelancer might be deemed to be a de-facto employee of his/her client rather than a sole trader who is a self-employed contractor. However, whether he is treated by HMRC, a tribunal, or any other body, as self-employed will depend not only on what is contained in his contract but also on all other circumstances: those circumstances will include the way in which the contract is implemented and the conduct of the client, the freelancer and anyone the freelancer engages to do any of the work for the freelancer, and all related arrangements between them.
HMRC provides some guidance on its website about self-employment. Its decisions as to whether someone is a self-employed sole trader are often based on a “balancing exercise” in which it gives weightings to various factors. However, neither the HMRC guidance nor case law are sufficiently precise to enable anyone to predict how in any particular case the “balancing exercise” would be carried out or what HMRC’s conclusion would be about that particular case. For that reason we recommend that you take professional employment law, tax, and NIC advice in relation to your particular circumstances before you decide to use or adapt this template.
Nevertheless, a carefully worded contract ensuring the independence of the freelancer is a key starting point. As a self-employed freelancer (rather than as an employee of the client), the software developer is, for example, free to engage a suitably qualified person to do some or all of the work in his place, is free to determine when, where and how work is completed (subject of course to the client’s requirements), is free to take on other clients, and most importantly may be subject to penalties if the work is not completed on time
Payment under this agreement may take the form of a single flat fee or initial fee followed by a series of milestone payments.
Moreover, the fee also serves as consideration for the assignment to the client of the copyright (and any other IP rights) in the work produced by the software developer. This assignment by the software developer to the client of all copyright and other IP rights in the work means that the client will own all of those rights exclusively, and so the client will be free to use and exploit the work as it wishes. The software developer is not granted any right to use or exploit any of the work, and consequently he will not be permitted to make any use of any of the work for his own (or any third party) purposes.
Each party provides warranties and indemnities to the other with regard to the non-infringement of third party intellectual property rights.
Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
This Freelance Software Developer's Contract contains the following sections:
1. Definitions and Interpretation
2. Engagement of the Developer
3. Nature of Engagement
4. Self-Employment Status of the Developer
6. Intellectual Property
7. Developer’s Warranties and Developer’s and Client’s Indemnities
8. Client’s Warranties
12. Data Protection
13. Data Processing
14. Force Majeure
15. Nature of the Agreement
18. Alternative Dispute Resolution
19. Law and Jurisdiction
and the following schedules:
Schedule 1: The Software
Schedule 2: Client’s Materials
Schedule 3: Name of any Consultant engaged by Developer
Schedule 4: Data Processing details
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