5 Essential Contract Clauses Every Freelancer Needs

Freelancing offers freedom, but it also exposes you to risks like non-payment, scope creep, and endless revisions. A strong contract is your best defense. Here are the five clauses you must include in every agreement.

1. The "Scope Creep" Killer

Clearly define exactly what is included—and what isn't. Include a clause that states: "Any work requested outside the scope defined in Exhibit A will be billed at an hourly rate of $X." This prevents the "just one more small change" phenomenon from eating your profits.

2. Late Payment Fees

Clients prioritize bills that have consequences. Your contract should state: "Invoices not paid within 30 days will accrue interest at 1.5% per month." Often, just having this clause is enough to ensure you get paid on time.

3. Kill Fee / Cancellation Clause

What happens if the client cancels the project halfway through? You reserved time for them and turned down other work. A cancellation clause ensures you are paid for work completed plus a percentage of the remaining fee to cover the sudden gap in your schedule.

4. Intellectual Property Transfer

Most clients want to own the work you create ("Work for Hire"). However, you should include a clause that states: "IP rights transfer to the Client only upon full payment of all fees." This gives you leverage—if they don't pay, they don't own the logo/code/copy.

5. Limitation of Liability

This is your safety net. It limits how much a client can sue you for if things go wrong. A standard clause caps your liability at the total amount paid under the contract. Without this, a small project could theoretically lead to a lawsuit for millions in "lost revenue."