One of the biggest misconceptions about freelancing is that you don’t need any of the “fancy” business stuff – like an LLC, a solidified offer structure, and even legal contracts.
And I totally understand where these misunderstandings come from. Most of the time when someone has deemed themselves as a freelancer, they simply mean that they’re offering individual services of some kind to clients on a project or contract basis, rather than working as a full-time employee for a single company.
It’s the type of work where you get to work independently, set your own schedules, and can even operate in various industries, including writing, graphic design, web development, consulting, photography, and more.
But it’s important to understand that even as a freelancer, you DO need certain “fancy” business things in place in order to protect your work, your time, and your income. And the biggest way you can do that is by implementing the right contracts.
Because without the right legal agreements in place, you’re leaving yourself open to potential disputes, unpaid invoices, and even legal trouble. That’s why every freelancer needs a solid legal foundati>3 essential contracts – keep reading to learn more about what they are and why you need them!
The 3 Most Important Contracts For Freelancers
1. Independent Contractor Agreement
One of the biggest risks freelancers face is working without a contract. A verbal agreement or a few emails outlining the project scope might seem sufficient, but without a written contract, you have little legal protection if a client refuses to pay, changes project terms, or ghosts you altogether.
This is why when you take on freelance work, having the client sign an Independent Contractor Agreement is a MUST! This contract will outline all of the key details of your working relationship, including:
✔️ Payment terms (rates, invoicing schedule, and late fees)
✔️ Project scope (what’s included—and what’s not)
✔️ Revisions and additional work policies
✔️ Intellectual property rights (who owns the work you create)
✔️ Confidentiality and non-disclosure terms
Overall, this contract ensures you get paid fairly and on time while preventing scope creep because all business owners know that when a client asks for “just one more thing,” it turns into 234567 more things without additional compensation, which is NOT a situation you want to be in!
Additionally, if a client disputes payment or demands more work than agreed upon, your contract gives you legal grounds to enforce the original terms.
Website Privacy Policy
2. Website Privacy Policy
As a freelancer, if you have a website where you collect any type of user data, such as email addresses, names, or payment details, you are legally required to have a Website Privacy Policy.
A Privacy Policy explains what data you collect, how you use it, and how you protect user privacy. This is crucial if you:
✔️ Have an email list or newsletter
✔️ Sell digital products or services on your website
✔️ Use contact forms, cookies, or analytics tools like Google Analytics
✔️ Collect payment details for invoices or services
Data privacy laws like the GDPR (General Data Protection Regulation) in Europe and the CCPA (California Consumer Privacy Act) in the U.S. require businesses, INCLUDING freelancers, to disclose how they collect and use personal information and non-compliance can lead to hefty fines.
(We’re talking up to $7500 fines per violation 🤯)
Overall, a Privacy Policy ensures you’re transparent with website visitors, builds trust with clients, and keeps your freelance business legally compliant.
For my full spiel on privacy policies and why you really need one, CLICK HERE.
3. Website Terms of UseWebsite Terms of Use
Your Website Terms of Use (also called Terms and Conditions) act as the legal agreement between you and the visitors who interact with your site. This contract outlines important rules about how people can use your website, protecting you from liability and potential disputes.
Your Website Terms of Use should include:
✔️ Disclaimers that limit your liability if users rely on the information on your site
✔️ Copyright policies to prevent people from copying or misusing your content
✔️ Guidelines for website users (especially if you have a blog, portfolio, or forum)
✔️ Payment and refund policies (if you sell products or services on your site)
If someone tries to steal your content, makes false claims about your services, or misuses your website, your Terms of Use provide legal backing to protect you.
Without clear website terms, visitors may assume they can use your content however they want, or even hold you responsible for how they interpret your advice or services.
The Risk You Take By Not Having Contracts as a Freelancer
Choosing not to implement contracts as a freelancer puts you in a few risky situations, including:
❌ Clients refusing to pay or demanding extra work without compensation
❌ Legal liability for not having proper data protection policies
❌ Copyright infringement when others steal or misuse your work
❌ Difficulty enforcing boundaries around revisions, cancellations, or refunds
And unfortunately, if you don’t have any contracts in place, there isn’t much you can do to fight the situation if or when it comes up.
Ultimately, by having these 3 essential contracts in your business, you’re protecting your business from unnecessary risks and setting clear expectations for your clients.
Protect Your Freelance Business with These Essential Contracts
So if you’re serious about running a successful freelance business and protecting your work, time, and money along the way, start by implementing the 3 contracts mentioned above. And no, you don’t have to piece them together on your own!
The Freelancer Contract Bundle from TBL’s Contract Template Shop includes all 3 must-have contracts – Independent Contractor Agreement, Website Privacy Policy, and Website Terms of Use – so you can confidently run your freelance business with legal protection in place!
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