Freelance Contract Essentials — Scope, Payment Terms and Getting Paid on Time
Every freelance engagement needs a written contract fixing: precise scope and revision limits, milestone-linked payments (advance of 25–50% is standard), late-payment interest, IP transfer only on full payment, and termination/kill-fee terms. With it, an unpaid invoice is a clean recovery case — a ₹999 legal notice, then summary suit or MSME Samadhaan if you're Udyam-registered.
कायदेशीर मुदती
- Day 0 — Contract before work starts (emails can form it, but sign properly)
- 15–30 days — Invoice payment window (state it + late interest (1.5–2%/month))
- 15 days — Follow-up + legal notice (after the due date lapses)
- 3 years — Suit limitation (from the invoice falling due)
पायरी-पायरीने: काय करावं
- 1
Scope in numbers, revisions capped
Deliverables, timelines, and what counts as "extra".
तपशील पहा
Write deliverables measurably — "5-page website: home, about, services, blog, contact; 2 revision rounds included; further revisions at ₹X/round". Add client dependencies (content, approvals within N days) so their delays don't become your breach. Scope creep is the #1 freelance dispute — the revision cap and change-request pricing clause are what prevent it.
- 2
Payment architecture that protects you
Advance + milestones + late interest + kill fee.
तपशील पहा
आम्ही हे तुमच्यासाठी करतो — ₹499Standard protective structure: 25–50% advance before starting, milestone payments on defined deliveries, balance before final handover; invoices due in 15–30 days with late interest of 1.5–2% per month stated; a kill fee (e.g. 50% of remaining milestone) if the client cancels mid-project. Never deliver final files against a promise — see the IP step.
- 3
IP transfers only on full payment
Your leverage clause — the work stays yours until paid.
तपशील पहा
State expressly: all IP in the deliverables assigns to the client only upon receipt of full payment; until then you retain ownership and licence nothing. Add your right to portfolio display (unless NDA'd), and moral-rights/credit terms if you care. This clause converts "pay when we feel like it" into "no payment, no rights" — the single strongest lever a freelancer holds.
- 4
When they don't pay: the recovery ladder
Reminder → legal notice → summary suit / MSME route.
तपशील पहा
Send a dated payment reminder, then an advocate's legal notice (₹999) — most agencies and startups pay on the notice. Escalation: with your written contract + invoices, a summary suit under Order 37 CPC (leave-to-defend hurdle for the client); or if you hold Udyam (MSME) registration, file on MSME Samadhaan — the facilitation council route with compound interest at 3× bank rate under the MSMED Act. Cheque given and bounced? The Section 138 criminal route (see our cheque bounce guide) runs in parallel.
खर्च आणि काय अपेक्षित
- ₹499
Freelance contract drafting
WakilBhai; scope + IP + payment armour
- ₹100–500
Stamp duty
State-wise; e-sign valid
- ₹999
Recovery legal notice
Advocate-sent; most disputes end here
- Free (govt)
Udyam registration (unlocks MSME route)
Assistance ₹499 if wanted
Register on Udyam even as a solo freelancer — service providers qualify as micro enterprises, and the MSMED Act's 45-day payment rule + compound interest is the strongest unpaid-invoice remedy in Indian law.
या अडचणीसाठी मोफत नमुने
वारंवार विचारले जाणारे प्रश्न
The client and I only have emails and WhatsApp — is there a contract?
Probably yes: offer, acceptance and consideration over email/chat form a contract, and courts accept the trail as evidence. It is just messier to prove scope and terms. Going forward, send a one-page terms note and get a written "confirmed" — or use a proper signed agreement.
Client took the delivered work and vanished without paying. What now?
Recovery ladder: reminder, ₹999 advocate notice, then summary suit (your invoices + delivery proof are the written contract Order 37 loves) or MSME Samadhaan if Udyam-registered. If your contract had the IP-on-payment clause, their continued use of the work is also infringement — a separate, powerful pressure point.
What is a kill fee and is it enforceable?
A pre-agreed amount payable if the client cancels mid-project — compensating booked time and lost opportunities. As liquidated damages under Section 74 Contract Act, reasonable pre-estimates are enforceable. 25–50% of the unbilled remainder is the common range.
Can I charge interest on late payments?
Yes if the contract says so — 1.5–2% per month is standard and enforceable as a contractual term. Udyam-registered freelancers get the statutory override: payment due within 45 days regardless of contract, with compound interest at three times the RBI bank rate on delays.
Should I work through an LLP/company or as an individual?
Start individual (with contracts + Udyam); consider an LLP when annual revenue is significant, clients demand entity invoicing, or liability exposure grows (software with damages risk). GST registration triggers at ₹20 lakh services turnover (₹10 lakh special states) or on interstate B2B in some cases — plan invoicing accordingly.
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