A consultancy agreement template UK IR35 rules make almost unavoidable to get right: the moment you engage an independent contractor, or take one on, the wording of the contract starts to matter for tax as well as for the work itself. A consultancy agreement is the contract between a business and a self-employed consultant, someone genuinely in business on their own account, not an employee, and a good one covers the services, the fees, who owns the intellectual property, and the terms that keep the relationship on the right side of the line HMRC cares about. This guide explains what a UK consultancy agreement should cover, including the IR35 angle, and how to draft one from vetted clauses in 99 Data Rooms. It is general information, not legal or tax advice.
Consultants and freelancers who want to look professional and get paid cleanly need this, and so do the agencies and businesses that engage them. The stakes are practical on both sides: the consultant wants clarity on scope, payment and IP; the engager wants the arrangement to reflect a real contractor relationship rather than "employment in disguise", because getting IR35 status wrong can be an expensive surprise. A template that is written with that risk in mind is worth far more than a generic services contract that ignores it.
What a UK consultancy agreement should cover
The functional core is straightforward: define the services, the fees and how they are invoiced and paid, the duration, and how either party can terminate. Because a consultant is running their own business, the agreement should reflect that reality, the consultant usually decides how the work gets done, can often send a suitably qualified substitute, and typically carries their own insurance and equipment. Those features are not just commercial preferences; they are the kind of factors that point towards genuine self-employment rather than employment, so a contract that quietly strips them out can undermine the very status both parties are relying on.
That is where IR35 comes in. The off-payroll working rules look at whether, stripping away the contractor label, the working relationship actually looks like employment, considering things like control over the work, whether there is a right of substitution, and whether there is mutuality of obligation (see Sources for HMRC's guidance). A well-drafted consultancy agreement is written to be consistent with a true contractor relationship: it avoids employee-style controls, includes a genuine right of substitution where appropriate, and does not oblige the business to offer, or the consultant to accept, an ongoing stream of work. It is important to be honest about the limits here, a contract cannot rescue an arrangement that is employment in substance, and status ultimately turns on the real working practices, not just the paper. But getting the paper right is a necessary part of the picture, and it is general information rather than tax advice, so a genuinely borderline case is one to check with a professional.
A practical point that helps both sides is being explicit about expenses, equipment and how the work is delivered. A genuine consultant usually provides their own tools and covers their own costs unless something is agreed otherwise, and saying so in the contract both avoids billing disputes and reinforces the picture of an independent business rather than an employee in all but name. Small clarity here pays off later.
The other clause that earns its place is IP assignment. Consultants frequently create things, code, designs, reports, materials, and unless the agreement assigns that IP to the engaging business, the default position under England and Wales law is often that the consultant keeps it as first owner (see Sources); our IP assignment guide sets out why that default catches so many businesses out. The template handles this directly, assigning IP in the work product to the client, which is exactly what a business paying for deliverables expects and what its own customers or investors will later expect to see. Confidentiality, data protection and liability provisions round out a sensible agreement, and where a consultant will be handling sensitive material a separate one-way NDA sometimes sits alongside it. Both sides then know where they stand if something goes wrong.
How the drafter builds one
In the 99 Data Rooms drafter, the "Legal Drafting" feature, the Consultancy Agreement sits in the "People & Founders" cluster alongside the employment and advisory templates. Its output is trustworthy for a routine engagement for one specific reason: the assistant selects vetted England and Wales clauses by ID from your answers and fills the blanks, assembling from a maintained clause library rather than writing legal wording itself. Vetted clauses, assembled, not AI-invented law, and not a generic template of unknown origin.
You can open the template or describe the engagement in plain words, "consultancy agreement, six months, day rate, IP to us, IR35-aware", and the assistant asks a handful of questions: the parties, the services, the fees, the term, and the IP position. It assembles the draft with the IR35-aware framing and IP assignment built in, and saves it free to keep. Because status is a genuinely fact-sensitive area, treat the result as a strong, current baseline: it is general information, not legal or tax advice, so a borderline IR35 situation is worth a specialist review before you sign.
Draft it, share it, sign it, one continuous flow
Drafting the consultancy agreement in 99 Data Rooms keeps it inside a single controlled flow rather than bouncing around inboxes. Once the draft is ready you share it as a tracked, revocable link instead of an attachment, gated behind a verified email and a one-time code so only the intended consultant or client can open it. Page-by-page analytics show whether they have read it and how long they spent, distinguishing a raw visit from a verified viewer who passed the gate, handy when you are waiting on a counter-signature and want to know if the document has even been opened.
When both sides agree, you send it for signature in the browser: signers sign in order, you can prompt a slow signer with a reminder, and the executed PDF returns with an audit certificate recording who signed, when, their IP, intent to sign, and a SHA-256 fingerprint. Electronic signatures are admissible for most commercial documents in England and Wales, with exceptions such as deeds, wills, land transfers and lasting powers of attorney (see Sources), general information, not legal advice. The signed agreement files itself where you can find it, and access stays revocable in one click if the engagement changes. Drafted, gated, tracked and signed, without the document ever leaving your control.
Draft your consultancy agreement for free
Draft an IR35-aware consultancy agreement from vetted England and Wales clauses in 99 Data Rooms, keep the draft, and share or sign it in the same place. The free tier is real rather than a trial: three rooms, twenty-five active links, forever, no card. Start for free: it is in beta and improving fast, and the path from "I need a proper contractor agreement" to a signed PDF with an audit trail already works end to end, with the IR35 wording and IP assignment handled from the start.
Sources
- Off-payroll working (IR35): HMRC guidance, https://www.gov.uk/guidance/understanding-off-payroll-working-ir35
- Copyright first ownership (why IP must be assigned to the client): Copyright, Designs and Patents Act 1988, s.11, https://www.legislation.gov.uk/ukpga/1988/48/section/11
- Electronic signatures, validity and witnessing of deeds in England and Wales: Law Commission, Electronic execution of documents (2019), https://lawcom.gov.uk/project/electronic-execution-of-documents/ ; HM Land Registry Practice Guide 82, https://www.gov.uk/government/publications/electronic-signatures-accepted-by-hm-land-registry-pg82
Does a consultancy agreement put me outside IR35?
Not on its own. IR35 status depends on the true nature of the working relationship, control, substitution, mutuality of obligation and the wider picture, not just the contract wording. A well-drafted, IR35-aware agreement is written to be consistent with genuine self-employment, but it cannot override how the work is actually carried out. Borderline cases are worth checking with a tax specialist; this is general information, not tax advice.
What is the difference between a consultancy agreement and an employment contract?
A consultancy agreement engages a self-employed contractor who is in business on their own account, typically controlling how the work is done and invoicing for it. An employment contract creates an employee relationship with the rights and obligations that come with it, such as holiday, notice and statutory protections. Using the right one matters for both employment rights and tax.
Who owns the work a consultant produces?
By default under England and Wales law the consultant often retains IP in what they create, so unless the agreement assigns it to the engaging business, ownership can stay with the consultant. The vetted template assigns IP in the work product to the client, which is what most businesses paying for deliverables need. This is general information, not legal advice.
Can I use one consultancy template for every contractor?
A vetted template is a strong starting point for most routine engagements, but the details, services, fees, IP, and especially IR35 considerations, vary, so each agreement should be filled in for the specific engagement. The drafter is built to do exactly that, asking the questions that shape the document. For higher-value or borderline arrangements, take advice.
How do we sign the agreement once it is drafted?
It flows straight into e-signature inside 99 Data Rooms, so both parties sign in the browser and receive an executed PDF with an audit certificate. E-signatures are admissible for most commercial documents in England and Wales, subject to the usual exceptions. General information, not legal advice.