Consultant Agreement

As an independent contractor, your salary is not withheld for payroll taxes like Social Security and Medicare. You will also be responsible for the full rate as you wouldn’t have any employer contributions. Depending on your income, you may be required to pay estimated taxes several times a year. The burden is on you, as the consultant, to figure out the taxes owed.

Verbal agreements are still considered valid, although that varies by jurisdiction, Furthermore, they're not easily enforceable. A court may interfere and adjudicate a dispute. However, if you have a written Consultant Agreement, enforcing the contract's provisions becomes much easier.

A consultant works as an independent contractor, not an employee. For a start, consultants are not covered by workers' compensation or any public unemployment benefits, unlike employees. Another meaningful difference is that a consultant is not subject to as much control from the client.

Not having a Consultant Agreement can lead to many unfavorable consequences. Apart from the risk of not getting paid, your work may get stolen and compromised. Without a written contract, it may be very difficult to prove otherwise. Also, not having a contract could lead to tax issues.

For the client, not having a Consultant Agreement could lead to loss of time. A company might also experience unexpected expenses if they are to get involved in a lawsuit as a defendant. They could also experience a breach of sensitive information for not having a contract with a confidentiality clause.