Self-Employment Contract Templates
Self-employment is a broad term referring to anyone who works for themselves and is not an employee on someone else’s payroll. When striking out independently in the UK, individuals often apply a variety of terms in relation to self-employment. The terms sole trader, self-employed, freelancer, subcontractor and personal service company (PSC) and IR35 often arise in this context. While these terms are inter-related there are essentially 2 different models for self-employment which have distinct legal meanings and practical implications - Sole Trader and Personal Service Company. To help navigate through the differences please download: Guidance Note on Employment, Self-Employment and IR35 and Employment, Self-Employment and IR35 Checklists.
Legal Application
These self-employed agreement templates have been drafted and kept up-to-date by solicitors and HR professionals, and are regularly downloaded by sole traders, self-employed operating via personal service companies, HR professionals, accountants and solicitors.
Which is the most suitable self-employed agreement?
The selection of Self-Employment Contract Templates below provides for both the sole trader (where the term Self-employed is substituted for Sole Trader) and PSC models. Each selection of templates provides for different types of business operations and for the requisite distinctions between these models such as the contracting entity, employment status, substitution, tax and liability, control and supervision, payment terms, termination and liability and insurance requirements. Each template has a full description with the portfolio divided into three parts to ease identification of suitability.
The Self-Employed Agreements selection of templates provides for individuals and freelancers operating as sole traders across a range of trades and professions who engage and contract direct with their clients. In addition to a standard self-employed contractor agreement which can be used for a variety of roles, versions are also available specifically for clerical and administrative staff, and sales. The portfolio also includes a number of chair rental agreements covering hairdressers, beauty therapists and nail technicians.
The Self-Employed Subcontractor Agreements is also for use by individuals and freelancers operating as sole traders but these templates are only where the individual is a subcontractor to a main client, i.e. the freelancer works for the contractor, not directly for the client. They can be used by a contractor when they engage someone as a self employed subcontractor or by the subcontractor to safeguard their work on behalf of the contractor. The most frequent downloads are the Construction Subcontractor Agreement and IT Subcontractor Agreement. Generic versions are also available for fixed term, fixed fee and variable fee contracts.
The PSC Contractors Agreements can be used when individuals are working for clients through a company, i.e. they do not work as employed or self employed individuals for their clients. They instead work for an intermediary company (usually owned by them) and that company provides their services to their clients. These agreements can be used for a range of trades.
Please click on the links below to view and access the full range of self-employment templates:
Self-Employment Contract Templates is part of Employment. Just £38.50 + VAT provides unlimited downloads from Employment for 1 year.
Frequently Asked Questions
I work for myself and a client wants a written contract. Do I need a self-employed agreement, and which type should I use? +
Use a Generic Self-Employed Agreement template if you contract directly as a sole trader or freelancer, or a PSC Contractors Agreements template if you provide services through your own limited company, because the contracting party, tax rules and IR35 considerations differ. A written contract is not legally required but is strongly advisable: it records what was agreed, reduces dispute risk over scope or payment and evidences genuine self-employment rather than employment. The free Guidance Note on Employment, Self-Employment and IR35 and accompanying checklists help you decide.
What is the difference between a sole trader self-employed agreement and a PSC contractor agreement, and does it matter which I use? +
It matters significantly because the contracting entity, tax treatment and IR35 application differ. A sole trader contracts directly as an individual, so person and business are the same entity and IR35 does not directly apply, though employment status rules still do. A PSC is a limited company providing services, where IR35 and off-payroll rules can apply, and since April 2021 medium and large private sector clients determine whether those rules apply to each engagement. The Simply-Docs templates are drafted differently for each model, covering contracting entity, substitution rights, tax liability, payment terms, termination and insurance. The wrong template could leave key provisions missing or incorrect.
I am a freelancer working for a main contractor rather than directly for the end client. Which self-employed agreement should I use? +
Because you work for a contractor who holds the main contract with the end client rather than for the end client directly, use a Self-Employed Subcontractor Agreement, not a direct self-employed contractor agreement. The templates in the Self Employed Subcontractor Agreements sub-folder suit this arrangement. Either side can use them: the main contractor to engage a subcontractor, or the subcontractor to record their terms. Generic versions cover fixed term, fixed fee and variable fee arrangements. For construction work, the Construction Industry Scheme (CIS) may also apply.
I run a hair or beauty salon and want to take on a self-employed stylist or therapist on a chair-rental basis. What contract do I need and what are the risks? +
Use a chair rental agreement drafted for self-employed individuals: choose Simply-Docs Self-Employed Chair Rental Contract Templates (sole traders) or PSC Chair Rental Agreement Templates (stylists or therapists working through their own company). The key risk is misclassification: HMRC can treat the stylist as an employed worker if the agreement and day-to-day working practices are inconsistent with genuine self-employment. Genuine self-employment is shown by the stylist controlling their own hours, prices and clients, providing their own products, bearing their own financial risk and being registered as self-employed with HMRC. The agreement is only a starting point: working practices must reflect real independence. Seek professional legal, tax and NIC advice before using any template.
I am not sure whether to contract as a sole trader or set up a limited company (PSC). Does the type of self-employment contract I use depend on that decision? +
Largely, but not entirely: the contract should match your actual business structure. As a sole trader you contract personally with the client and use a sole trader self-employed agreement. Trading through your own limited company (a PSC) means the company contracts with the client, so you need a PSC contractor agreement. Sole traders are personally liable for business debts and outside IR35 (though general employment status rules still apply), while PSC contractors have limited liability. With a PSC the off-payroll working rules can shift responsibility for deciding IR35 status to the client, but only where the client is a public sector body or a medium or large private or voluntary sector client. Where your PSC works for a small private sector client, the off-payroll reform does not apply to the client and your own intermediary (the PSC) remains responsible for deciding your IR35 status. This works contract by contract, so a given engagement may be inside or outside IR35 and your status is not fixed purely by your business structure. Before choosing, download the free Guidance Note on Employment, Self-Employment and IR35 and its checklists from Simply-Docs, and consider professional advice.
Does a self-employment contract guarantee that HMRC will treat the worker as self-employed? +
No. A carefully drafted self-employed agreement is important evidence of the intended relationship but it is not decisive. HMRC and employment tribunals look at the reality of how the arrangement works in practice, not the contract label, including whether the worker can send a substitute, the degree of control the client exercises and whether there is mutuality of obligation. If day-to-day practices resemble employment, HMRC can reclassify the arrangement. Simply-Docs templates reflect genuine self-employment but cannot remove the risk entirely, so professional employment law, tax and National Insurance advice is recommended before engaging someone on a self-employed basis.
