Consultancy Agreement (for self-employed consultant or client) – short form

What is a consultancy agreement (for self-employed consultant or client) and when should you use it?

A consultancy agreement is an agreement between a company (usually referred to as the “client”) and a service entity (usually referred to as the “consultant”).

The consultant agrees to provide a service to the client for a fee.

The consultant may agree to provide a one-off service for a set fee or continuing services to the client for a predetermined length of time for a fee.

This Self-Employed Consultancy Agreement (Short) provides a short and simple to use agreement for independent consultants who are individual sole traders or partnerships intending to perform consulting services for a company.

It can also be used by a client who is looking to work with a consultant as it is drafted in a way that is balanced for both the Consultant and the Client.

With minor adjustments this template may also be used where the self-employed consultant intends to provide services to an individual.

This form of agreement aims to reduce the risk that the individual consultant might be deemed to be a de-facto employee of the client as opposed to a sole trader who is a self-employed contractor, but whether in law he/she is self-employed will depend on all circumstances (not just on the terms of this agreement).

This template provides a form of business agreement which can easily be used for simple and short term relationships.

Where the consultant is a limited company, the alternative short-form Consultancy Company Agreement should be used.

Where a more detailed or longer-term relationship is to be created between a self-employed consultant and their client, one of our other forms of agreement below should be used instead.

Consultancy Agreement (Medium)

Consultancy Agreement (Long)

What else might you need?

It’s important to distinguish contractors/consultants who are self-employed from employees, not least for tax reasons.

Self-employed persons operate either as sole traders (and would use a contract for services such as this template) or as a part of their own limited company (and they’d use our related template contract for services for a consultancy company in those circumstances).

Self-employed contractors can choose what work they do, and they can decide when and where they complete the work.

They are able to outsource work to others, they provide their own work equipment, and they often work for more than one client at a time.

They’re responsible for arranging their own tax and Social Insurance contributions.

They have fewer rights than employees.

It’s important to ensure that a consultant/contractor is not an employee in disguise – even if that outcome is inadvertent.

Getting it wrong can mean that both parties will face fines from the Revenue.

The wording of this template is carefully constructed to provide clarity about your respective intentions and to avoid ambiguity about the role that the consultant is to play.

Of course, drafting a document is one thing.

You’ll need to ensure that your relationship in practice is consistent with what’s described in this document and conforms to the legal rules.

Our guide contractor or employee also provides helpful background.