Free Simple Consulting Agreement Letter

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After knowing how to get into consulting, you know that consulting agreements differ tremendously in scope. They vary from simple to incredibly complex contracts depending on the nature of the project they are covering. Although deals and contracts could be sealed just by having a handshake, it is a wise decision for every consultant to ensure a simple consulting agreement letter is in place and signed before starting any project. Contracts are essential in protecting freelancers and consultants as well as their clients against unforeseen circumstances or in the case when agreements go awry. 

If you are a consultant, drafting agreements is one of the everyday paperwork you'd handle as a part of your business flow. It is crucial in project execution, record purposes, and protecting you from unwarranted liabilities. If you are new to simple consulting agreement letter drafting, this article gives a guide on the essential contents of a professional consulting agreement.

Here are the essentials of a simple consulting agreement letter - a competent consulting agreement includes the following details

1. List the parties involved in the simple consulting agreement letter

The parties (consultant and customer) information must be listed on every simple consulting agreement letter to identify them. Relevant information in this section includes name, email address contact addresses, phone numbers, and websites. 

2. Include scope of service in the simple consulting agreement letter

Next is the description of the project and the goal/objective to be achieved. Ensure you display professionalism and a good understanding of what the job entails as a consultant. 

3. Mention services and responsibility in the simple consulting agreement letter

The next information is the services you will be offering and your deliverable clearly outlined in the simple consulting agreement letter. Ensure you state all your responsibilities and that of your client towards achieving the objective of your relationship. Doing this will exonerate you if your client fails or delay in providing the materials needed for the job.

4. Include service fees and terms of the agreement in the simple consulting agreement letter

Knowing how to bill for consulting services is important so you won't undercharge or overcharge your clients. Ensure you state your fees and break it down to the sub-tasks if need be for clarity. Also, state the expected time you'd be sending an invoice, the due date of payment, and other terms that govern the consulting service relationship. 

5. Cover taxes and expenses in the simple consulting agreement letter

Tax responsibility should be discussed before adding to the financial burden of the client. Unless the consultant has provided relevant information with a notice, a clause should be added for the client to be responsible for remitting sales tax on goods and services to the appropriate taxation body. 

6. Mention project duration in the simple consulting agreement letter

The time allocated to complete the project should be stated on the agreement, likewise specific times for milestone completion. 

7. Include details of licenses & permits needed in the simple consulting agreement letter

As a consultant, you should have a clause in your simple consulting agreement letter that gives you the right to necessary license and permits plus approvals that are required to comply with the laws, codes, and regulations relating to the service you will be rendering to the benefit of your client. 

8. Mention insurance and indemnity in the simple consulting agreement letter

Consultants should obtain and hold in good standing insurance policies that protect their clients from the liability that may arise from a consultant’s delivery of the service under the simple consulting agreement letter. Contractual guarantees including but not limited to employment insurance, workers' compensation, and property damage insurance.

Besides, you should include in the agreement a clause that indemnifies and holds you as a consultant harmless from all claims of loss, expenses, or damage that clients might have in the past or future as a result of the service delivery by the consultant. This also applies to the directors, employers, or workers that a consultant employs in carrying out the service agreed upon by parties.

9. Address conflict resolution in the simple consulting agreement letter

There should be a section that states the method for resolving conflict, if any, results from the business relationship.

10. How to create an IT consulting agreement template

An opportunity to understand issues in the information technology foundation and assess possible feedback is a rewarding task. However, similar to any other consultant, you may be wondering about the payment and reward process that will compensate for your hard work and time.

You may already be processing a consulting agreement in your mind to improve your relationship with the information technology customer.

  • As a freelance professional, what can you do to make a valuable IT consulting agreement?
  • What if you have never had a chance to create an agreement before?
  • What should you include in this agreement?

If questions like these are disturbing you, then it’s time to find a template and customize it according to the specific requirements of your project. Let’s evaluate a few things that should be kept in mind while structuring an IT consulting agreement. 

10.1. Include your service description

The service description is the first component that should be incorporated in your IT consulting agreement. The services offered may be related to IT consulting. However, a clear and concise breakdown helps in forming succinct terms of service. As a result, it becomes necessary to include short-term services, project-based services, and ongoing services.

When this segmentation is incompetent, you can face problematic circumstances in the future. The customer can overwhelm you with additional work, which is not clearly defined under the agreement. 

10.2. Terms of payment

Including the terms of payment or compensation ratio goes without saying. However, defining the terms of payment in a detailed format eliminates future challenges. 

Some consultants prefer offering an aggregated sum for a certain task, and others prefer offering a fragmented view of constituent parts of the payment. In both cases, it is best to include the details of a few factors:

  • How will the payment be released? The mode of payment.
  • When should the payment be released? A time period during which the payment should be dispatched.
  • Under what circumstances should upfront payment be dispatched?

10.3. Termination

When the customer or the consultant wants to terminate the project, what should be the terms of termination? It is possible for the customer to terminate the contract when the project is still in its crucial stages. It is also possible for you to terminate the IT consulting agreement due to multiple reasons. 

Defining the terms of terminations will allow the company and consultant to mitigate risks. The company can dispatch pending payments immediately, and the consultant can dispatch promised work within the time limit. It saves the interests of both parties without creating a legal problem.

10.4. Ownership rights

Both parties - consultants and companies, may share confidential and sensitive information during the agreement lifetime. Who should own the information?

A special NDA (non-disclosure agreement) based on the requirements of the project should be signed to keep sensitive information safe. You should also include under what circumstances the delivered work remains in the ownership of the consultant. 

An IT consulting agreement offers protection in case you wish to seek legal help and advice from an authorized organization. However, in reality, legal actions are hectic and time-consuming. The contract, therefore, serves as a way of establishing customer’s and consultant’s expectations from the project. It helps in protecting the interests and property of both consultant and customer. 

Maintaining healthy terms with the customer creates the foundation for a successful relationship. Hence, it is suggested to work with the client to create an IT consulting agreement that is beneficial for the interests of both parties.

Frequently Asked Questions
Questions about this template.

What is a consulting agreement letter?

Consulting services may be complex at some point. A simple consulting agreement letter is used for basic consulting services with simple terms and conditions.

Why do you need a consulting agreement letter?

Simple consulting agreement letters provide a degree of protection for both parties. You can download Bonsai's free template to check this off your list and get started

Although simple, this may still take an amount of your time. Speed up the process by downloading the free template at Bonsai. You can customize and edit as needed.

Although simple, this may still take an amount of your time. Speed up the process by downloading the free template at Bonsai. You can customize and edit as needed.

Template preview

Free Simple Consulting Agreement Letter

Simple Consulting Agreement

Consultant
First Name
Last Name
Acme LLC.
Client
First Name
Last Name
Corporation Corp.

This Contract is between Client (the "Client") and Acme LLC(the "Consultant").

The Contract is dated [DATE BOTH PARTIES SIGN].

1. WORK AND PAYMENT.

1.1 Project. The Client is hiring the Consultant to do the following: Offer advice and expertise to help client in their business performance

1.2 Schedule. The Consultant will begin work on [START DATE] and will continue until the work is completed. This Contract can be ended by either Client or Consultant at any time, pursuant to the terms of Section 6, Term and Termination.

1.3 Payment. The Client will pay the Consultant a rate of [PROJECT RATE] (USD) per hour. Of this, the Client will pay the Consultant [DEPOSIT AMOUNT] (USD) before work begins.

1.4 Expenses. The Client will reimburse the Consultant's expenses. Expenses do not need to be pre-approved by the Client.

1.5 Invoices. The Consultant will invoice the Client [INVOICE FREQUENCY]. The Client agrees to pay the amount owed within [X DAYS TO PAY] days of receiving the invoice. Payment after that date will incur a late fee of [LATE FEE PERCENTAGE]% per month on the outstanding amount.

1.6 Support. The Consultant will not provide support for any deliverable once the Client accepts it, unless otherwise agreed in writing.

2. OWNERSHIP AND LICENSES.

2.1 Client Owns All Work Product. As part of this job, the Consultant is creating “work product” for the Client. To avoid confusion, work product is the finished product, as well as drafts, notes, materials, mockups, hardware, designs, inventions, patents, code, and anything else that the Consultant works on—that is, conceives, creates, designs, develops, invents, works on, or reduces to practice—as part of this project, whether before the date of this Contract or after. The Consultant hereby gives the Client this work product once the Client pays for it in full. This means the Consultant is giving the Client all of its rights, titles, and interests in and to the work product (including intellectual property rights), and the Client will be the sole owner of it. The Client can use the work product however it wants or it can decide not to use the work product at all. The Client, for example, can modify, destroy, or sell it, as it sees fit.

2.2 Consultant's Use Of Work Product. Once the Consultant gives the work product to the Client, the Consultant does not have any rights to it, except those that the Client explicitly gives the Consultant here. The Client gives permission to use the work product as part of portfolios and websites, in galleries, and in other media, so long as it is to showcase the work and not for any other purpose. The Client does not give permission to sell or otherwise use the work product to make money or for any other commercial use. The Client is not allowed to take back this license, even after the Contract ends.

2.3 Consultant's Help Securing Ownership. In the future, the Client may need the Consultant's help to show that the Client owns the work product or to complete the transfer. The Consultant agrees to help with that. For example, the Consultant may have to sign a patent application. The Client will pay any required expenses for this. If the Client can’t find the Consultant, the Consultant agrees that the Client can act on the Consultant's behalf to accomplish the same thing. The following language gives the Client that right: if the Client can’t find the Consultant after spending reasonable effort trying to do so, the Consultant hereby irrevocably designates and appoints the Client as the Consultant's agent and attorney-in-fact, which appointment is coupled with an interest, to act for the Consultant and on the Consultant's behalf to execute, verify, and file the required documents and to take any other legal action to accomplish the purposes of paragraph 2.1 (Client Owns All Work Product).

2.4 Consultant's IP That Is Not Work Product. During the course of this project, the Consultant might use intellectual property that the Consultant owns or has licensed from a third party, but that does not qualify as “work product.” This is called “background IP.” Possible examples of background IP are pre-existing code, type fonts, properly-licensed stock photos, and web application tools. The Consultant is not giving the Client this background IP. But, as part of the Contract, the Consultant is giving the Client a right to use and license (with the right to sublicense) the background IP to develop, market, sell, and support the Client’s products and services. The Client may use this background IP worldwide and free of charge, but it cannot transfer its rights to the background IP (except as allowed in Section 11.1 (Assignment)). The Client cannot sell or license the background IP separately from its products or services. The Consultant cannot take back this grant, and this grant does not end when the Contract is over.

2.5 Consultant's Right To Use Client IP. The Consultant may need to use the Client’s intellectual property to do its job. For example, if the Client is hiring the Consultant to build a website, the Consultant may have to use the Client’s logo. The Client agrees to let the Consultant use the Client’s intellectual property and other intellectual property that the Client controls to the extent reasonably necessary to do the Consultant's job. Beyond that, the Client is not giving the Consultant any intellectual property rights, unless specifically stated otherwise in this Contract.

3. COMPETITIVE ENGAGEMENTS.

The Consultant won’t work for a competitor of the Client until this Contract ends. To avoid confusion, a competitor is any third party that develops, manufactures, promotes, sells, licenses, distributes, or provides products or services that are substantially similar to the Client’s products or services. A competitor is also a third party that plans to do any of those things. The one exception to this restriction is if the Consultant asks for permission beforehand and the Client agrees to it in writing. If the Consultant uses employees or subcontractors, the Consultant must make sure they follow the obligations in this paragraph, as well.

4. NON-SOLICITATION.

Until this Contract ends, the Consultant won’t: (a) encourage Client employees or service providers to stop working for the Client; (b) encourage Client customers or clients to stop doing business with the Client; or (c) hire anyone who worked for the Client over the 12-month period before the Contract ended. The one exception is if the Consultant puts out a general ad and someone who happened to work for the Client responds. In that case, the Consultant may hire that candidate. The Consultant promises that it won’t do anything in this paragraph on behalf of itself or a third party.

5. REPRESENTATIONS.

5.1 Overview. This section contains important promises between the parties.

5.2 Authority To Sign. Each party promises to the other party that it has the authority to enter into this Contract and to perform all of its obligations under this Contract.

5.3 Consultant Has Right To Give Client Work Product. The Consultant promises that it owns the work product, that the Consultant is able to give the work product to the Client, and that no other party will claim that it owns the work product. If the Consultant uses employees or subcontractors, the Consultant also promises that these employees and subcontractors have signed contracts with the Consultant giving the Consultant any rights that the employees or subcontractors have related to the Consultant's background IP and work product.

5.4 Consultant Will Comply With Laws. The Consultant promises that the manner it does this job, its work product, and any background IP it uses comply with applicable U.S. and foreign laws and regulations.

5.5 Work Product Does Not Infringe. The Consultant promises that its work product does not and will not infringe on someone else’s intellectual property rights, that the Consultant has the right to let the Client use the background IP, and that this Contract does not and will not violate any contract that the Consultant has entered into or will enter into with someone else.

5.6 Client Will Review Work. The Client promises to review the work product, to be reasonably available to the Consultant if the Consultant has questions regarding this project, and to provide timely feedback and decisions.

5.7 Client-Supplied Material Does Not Infringe. If the Client provides the Consultant with material to incorporate into the work product, the Client promises that this material does not infringe on someone else’s intellectual property rights.

6. TERM AND TERMINATION.

This Contract is ongoing until the work is completed. Either party may end this Contract for any reason by sending an email or letter to the other party, informing the recipient that the sender is ending the Contract and that the Contract will end in 7 days. The Contract officially ends once that time has passed. The party that is ending the Contract must provide notice by taking the steps explained in Section 11.4. The Consultant must immediately stop working as soon as it receives this notice, unless the notice says otherwise. The Client will pay the Consultant for the work done up until when the Contract ends and will reimburse the Consultant for any agreed-upon, non-cancellable expenses. The following sections don’t end even after the Contract ends: 2 (Ownership and Licenses); 3 (Competitive Engagements); 4 (Non-Solicitation); 5 (Representations); 8 (Confidential Information); 9 (Limitation of Liability); 10 (Indemnity); and 11 (General).

7. INDEPENDENT CONTRACTOR.

The Client is hiring the Consultant as an independent contractor. The following statements accurately reflect their relationship:

  • The Consultant will use its own equipment, tools, and material to do the work.
  • The Client will not control how the job is performed on a day-to-day basis. Rather, the Consultant is responsible for determining when, where, and how it will carry out the work.
  • The Client will not provide the Consultant with any training.
  • The Client and the Consultant do not have a partnership or employer-employee relationship.
  • The Consultant cannot enter into contracts, make promises, or act on behalf of the Client.
  • The Consultant is not entitled to the Client’s benefits (e.g., group insurance, retirement benefits, retirement plans, vacation days).
  • The Consultant is responsible for its own taxes.
  • The Client will not withhold social security and Medicare taxes or make payments for disability insurance, unemployment insurance, or workers compensation for the Consultant or any of the Consultant's employees or subcontractors.

8. CONFIDENTIAL INFORMATION.

8.1 Overview. This Contract imposes special restrictions on how the Client and the Consultant must handle confidential information. These obligations are explained in this section.

8.2 The Client’s Confidential Information. While working for the Client, the Consultant may come across, or be given, Client information that is confidential. This is information like customer lists, business strategies, research & development notes, statistics about a website, and other information that is private. The Consultant promises to treat this information as if it is the Consultant's own confidential information. The Consultant may use this information to do its job under this Contract, but not for anything else. For example, if the Client lets the Consultant use a customer list to send out a newsletter, the Consultant cannot use those email addresses for any other purpose. The one exception to this is if the Client gives the Consultant written permission to use the information for another purpose, the Consultant may use the information for that purpose, as well. When this Contract ends, the Consultant must give back or destroy all confidential information, and confirm that it has done so. The Consultant promises that it will not share confidential information with a third party, unless the Client gives the Consultant written permission first. The Consultant must continue to follow these obligations, even after the Contract ends. The Consultant's responsibilities only stop if the Consultant can show any of the following: (i) that the information was already public when the Consultant came across it; (ii) the information became public after the Consultant came across it, but not because of anything the Consultant did or didn’t do; (iii) the Consultant already knew the information when the Consultant came across it and the Consultant didn’t have any obligation to keep it secret; (iv) a third party provided the Consultant with the information without requiring that the Consultant keep it a secret; or (v) the Consultant created the information on its own, without using anything belonging to the Client.

8.3 Third-Party Confidential Information. It’s possible the Client and the Consultant each have access to confidential information that belongs to third parties. The Client and the Consultant each promise that it will not share with the other party confidential information that belongs to third parties, unless it is allowed to do so. If the Client or the Consultant is allowed to share confidential information with the other party and does so, the sharing party promises to tell the other party in writing of any special restrictions regarding that information.

9. LIMITATION OF LIABILITY.

Neither party is liable for breach-of-contract damages that the breaching party could not reasonably have foreseen when it entered this Contract.

10. INDEMNITY.

10.1 Overview. This section transfers certain risks between the parties if a third party sues or goes after the Client or the Consultant or both. For example, if the Client gets sued for something that the Consultant did, then the Consultant may promise to come to the Client’s defense or to reimburse the Client for any losses.

10.2 Client Indemnity. In this Contract, the Consultant agrees to indemnify the Client (and its affiliates and their directors, officers, employees, and agents) from and against all liabilities, losses, damages, and expenses (including reasonable attorneys’ fees) related to a third-party claim or proceeding arising out of: (i) the work the Consultant has done under this Contract; (ii) a breach by the Consultant of its obligations under this Contract; or (iii) a breach by the Consultant of the promises it is making in Section 5 (Representations).

10.3 Consultant Indemnity. In this Contract, the Client agrees to indemnify the Consultant (and its affiliates and their directors, officers, employees, and agents) from and against liabilities, losses, damages, and expenses (including reasonable attorneys’ fees) related to a third-party claim or proceeding arising out of a breach by the Client of its obligations under this Contract.

11. GENERAL.

11.1 Assignment. This Contract applies only to the Client and the Consultant. The Consultant cannot assign its rights or delegate its obligations under this Contract to a third-party (other than by will or intestate), without first receiving the Client’s written permission. In contrast, the Client may assign its rights and delegate its obligations under this Contract without the Consultant's permission. This is necessary in case, for example, another Client buys out the Client or if the Client decides to sell the work product that results from this Contract.

11.2 Arbitration. As the exclusive means of initiating adversarial proceedings to resolve any dispute arising under this Contract, a party may demand that the dispute be resolved by arbitration administered by the American Arbitration Association in accordance with its commercial arbitration rules.

11.3 Modification; Waiver. To change anything in this Contract, the Client and the Consultant must agree to that change in writing and sign a document showing their contract. Neither party can waive its rights under this Contract or release the other party from its obligations under this Contract, unless the waiving party acknowledges it is doing so in writing and signs a document that says so.

11.4 Notices.

(a) Over the course of this Contract, one party may need to send a notice to the other party. For the notice to be valid, it must be in writing and delivered in one of the following ways: personal delivery, email, or certified or registered mail (postage prepaid, return receipt requested). The notice must be delivered to the party’s address listed at the end of this Contract or to another address that the party has provided in writing as an appropriate address to receive notice.

(b) The timing of when a notice is received can be very important. To avoid confusion, a valid notice is considered received as follows: (i) if delivered personally, it is considered received immediately; (ii) if delivered by email, it is considered received upon acknowledgement of receipt; (iii) if delivered by registered or certified mail (postage prepaid, return receipt requested), it is considered received upon receipt as indicated by the date on the signed receipt. If a party refuses to accept notice or if notice cannot be delivered because of a change in address for which no notice was given, then it is considered received when the notice is rejected or unable to be delivered. If the notice is received after 5:00pm on a business day at the location specified in the address for that party, or on a day that is not a business day, then the notice is considered received at 9:00am on the next business day.

11.5 Severability. This section deals with what happens if a portion of the Contract is found to be unenforceable. If that’s the case, the unenforceable portion will be changed to the minimum extent necessary to make it enforceable, unless that change is not permitted by law, in which case the portion will be disregarded. If any portion of the Contract is changed or disregarded because it is unenforceable, the rest of the Contract is still enforceable.

11.6 Signatures. The Client and the Consultant must sign this document using Bonsai’s e-signing system. These electronic signatures count as originals for all purposes.

11.7 Governing Law. The laws of the state of [STATE] govern the rights and obligations of the Client and the Consultant under this Contract, without regard to conflict of law principles of that state.

11.8 Entire Contract. This Contract represents the parties’ final and complete understanding of this job and the subject matter discussed in this Contract. This Contract supersedes all other contracts (both written and oral) between the parties.

THE PARTIES HERETO AGREE TO THE FOREGOING AS EVIDENCED BY THEIR SIGNATURES BELOW.

Consultant
First Name
Last Name
Acme LLC.
Client
First Name
Last Name
Corporation Corp.