A contract with a freelancer and taxes: how to work legally

Freelancing stopped being "work without rules" long ago. The bigger the projects, the more it matters to set up the relationship so both sides are protected. In this article we cover when you need a freelancer contract, what self-employment is, and how to pay freelancer taxes without turning a simple deal into a headache.

Why formalise anything at all

A verbal agreement works right up to the first dispute. The moment deadlines, revisions or refunds come up, everything rests on what you wrote down in advance. Written terms aren't about distrust — they're about clarity: who does what, by when, and what counts as delivered work. We covered this in detail in how to accept work from a freelancer.

A contract doesn't have to be 20 pages

A full contract makes sense for large, long projects. For most tasks a short written agreement is enough, fixing: a description of the work (or a link to the brief), deadlines, the amount and payment order, and who owns the rights to the result. Such an agreement can even live in your correspondence, as long as the terms are unambiguous.

Spell out the payment order separately. Full prepayment is risky for the client, full post-payment for the freelancer. A healthy compromise is to split the work into stages with interim acceptance. Read how this protects both sides in our piece on the safe freelance deal.

Self-employment and taxes

Working "on the books" is easier than it seems. Self-employed status lets a freelancer legally accept payment, issue a receipt and stop worrying about where the money came from. For the client, a receipt is proof of expense. The tax rate is low and there's no bookkeeping to keep — everything is calculated automatically.

If income grows and you take on staff or high turnover, it's worth looking at a registered business. But it's almost always easier to start with self-employment: minimum bureaucracy, maximum transparency. Legal income is also a payment history that helps with loans, visas and plain peace of mind.

How this affects the price

Tax is part of the cost of your service, and it should be built into the price in advance rather than paid out of your own pocket afterwards. If you're still shaping your rates, see our breakdown of pricing on freelance, while clients will find how much a freelancer's work costs useful.

The short version

Legal work isn't bureaucracy for its own sake — it's a way to make cooperation predictable. Put the terms in writing, split payment into stages, register as self-employed and build tax into the price. Then freelancing stops being a "grey zone" and becomes a normal business.

You can start a safe collaboration right now: see how 24freelance works, post a project or create a profile. And PRO features will get you priority in the catalog and more requests.