Service Agreement Template (Free Download)
Use this for ongoing or project-based service work where the scope is larger than a single deliverable: consulting, marketing, development, design retainers. It covers scope, change orders, payment, IP transfer, termination and liability. Change the five clauses below before you send it.
5 clauses to change before you send it
1. Scope and change orders
Attach the scope as a separate document (the SOW) and state that anything outside it needs a written change order with price and date. This single clause prevents most scope creep disputes.
2. Payment terms and late fees
Net-15 or Net-30 with a stated late fee (1–1.5% per month) is standard. Add whether work pauses on overdue invoices and who pays transfer fees. Vague payment terms are the most common cause of freelancer cash-flow problems.
3. IP transfer on payment
Assign IP only when the invoice is paid in full, not on delivery. Keep portfolio rights unless the client objects in writing, and name any pre-existing tools or libraries that stay yours.
4. Termination and kill fee
Allow either side to terminate with written notice, and state what happens to work in progress: payment for hours or milestones completed, plus a kill fee if the client cancels late.
5. Liability cap and indemnity
Cap total liability at fees paid (or a multiple), exclude indirect losses, and refuse unlimited indemnity. Uncapped indemnity is the clause that turns a $5,000 project into a five-figure loss.
Local differences
US: many states restrict non-compete clauses for contractors, so keep any restrictive covenant narrow and separate. EU/UK: check whether the client needs a DPA for personal data you touch, and whether VAT applies to your invoices. If you work with consumers, mandatory consumer law overrides several clauses.
What this service agreement covers
Scope and change orders, fees and payment terms, delivery, intellectual property, confidentiality, termination and kill fee, liability cap and governing law.
It works for project work and for retainers. For retainers, add a monthly deliverable list, a minimum term and a renewal clause.
How to use it
Download the DOCX, fill in the parties, attach the SOW as an appendix, and send a PDF for signature. Keep the signed copy and the SOW together — the scope reference is what makes the change-order clause enforceable.
If the client sends their own master agreement, compare three things first: payment terms, IP transfer timing, and the indemnity clause.
Change orders in practice
A change-order clause only works if there is something to change from. That means a written statement of work with deliverables, dates and price, attached to the agreement and signed at the same time.
Make the mechanics trivial: any change is requested in writing, priced within two business days, and work on the change starts only after written approval. Verbal approvals are how scope creep gets in.
Setting a kill fee that clients accept
A kill fee compensates you for capacity you reserved and cannot resell at short notice. Ten to twenty-five percent of the remaining contract value is common, higher inside the final two weeks before delivery.
Explain the reasoning in the proposal, not just the contract. Clients accept kill fees that map to real costs — booked time, declined work, non-refundable purchases — far more readily than a flat penalty.
Frequently asked
What is the difference between a service agreement and an SOW?
The agreement holds the legal terms that stay the same across projects: payment, IP, liability, termination. The SOW holds the scope, timeline and price for one specific project. Keep them separate so you only rewrite the SOW each time.
Can I send this template without a lawyer?
For small freelance engagements, a clear template is a reasonable starting point. Have a lawyer review once if the contract value is significant, if you handle regulated data, or if the client insists on unlimited indemnity.
Should payment be tied to milestones?
For projects longer than a month, yes. Milestone or monthly billing reduces your exposure and gives both sides a natural checkpoint to re-scope.
Who owns the work if the client never pays?
If the agreement transfers IP only on full payment, you keep ownership until you are paid. That is the practical reason to tie the transfer to payment rather than delivery.
What if the client disputes an invoice?
Have a clause that disputes must be raised in writing within a set period, and that undisputed amounts stay payable. That prevents an invoice being used as a negotiating lever after delivery.
Can I pause work on unpaid invoices?
Yes, if the agreement says so. Add that work may be suspended after a stated number of days overdue and that suspension does not count as breach by you.
TidyContracts provides general information and starting documents, not legal advice. We are not a law firm and do not create a lawyer-client relationship. Contract law differs by jurisdiction — have a qualified lawyer review anything important.