Freelance Developer Guide to Invoicing and Contracts

When you are working as a freelance developer, you obviously know your way around the world of technology. However, you may not be quite as hot at getting your business affairs organized and keeping everything up to date. It can be a tricky line to walk between being well organized but still managing to keep your developer's creativity moving forward and being constantly renewed. When you first set up, you should have a sound organizational plan in place, and there are many good reasons for this as will be discussed below. Many small businesses and sole traders go out of business simply because they have failed to run a tight ship and keep track of contractual and financial issues. Unfortunately, the world of business can be very unforgiving of those who don't get it together, but it's really not too difficult to do all the nuts-and-bolts organizational things that are crucial as well as maintain that important creative focus as you develop and bring to fruition new business ideas.

Always have a contract

A contract is a legal document that protects you when you take on work from a client, but you have to ensure that the contract is binding on both sides so that you know exactly what you are being required to deliver and what your rights are, and so that the client knows what will be received, and that they are also protected should, for any reason, something goes wrong.

Contracts are there not just for protection but also for making sure that you and your client understand each other from the start. It takes time to get it right, but in the long run, it's worth it.

Key markers for developing a contract

  • Be specific about what you will do : your Scope of Work defines what you will do for your client. Don't let it be vague on either side - specify as clearly as you can what is and is not included so that your client knows exactly what can be expected from you before your work starts.
  • Ownership issues : these can be complicated and relate to who owns the work you are doing. You can assign ownership to a client, or you can retain ownership and control by using a license. Whenever you are drawing up a contract, especially if it's a complex one, it's worth taking legal advice. It might cost a little up front, but it could save you a fortune in the future.
  • Changes to the brief : this is almost inevitable at some stage, so make sure you state how many revisions you will do that are included in your fee. Your contract should then stipulate how much additional revisions will cost and be clear as to what "revisions" actually means.
  • Hitting deadlines : all freelancers, no matter what industry they are in, understand the need for deadlines and to be prepared to hit them. It's part of the planning process before a project begins. If a client decides to move a deadline up, disrupting your working pattern, it can be difficult to deal with. Your contract should stipulate delivery times, especially if there are a number of project phases, and if the client changes your Scope of Work, you should have a clause in the contract that states that your deadline will be subject to change under those circumstances.

There are other considerations, such as how much you will be paid and when, what happens if fees are paid late, how your expenses will be reimbursed, and what to do if a client decides to terminate the contract early for whatever reason. If you think through everything up front and have a contract that is as cast-iron as possible, you're well on the way to being a successful and savvy freelance developer.

It's perfectly possible to remain on good terms professionally with a client by being courteous but also knowing what you are and are not prepared to do. It's why starting work without a contract in place can lead to serious problems down the line.

Business finances

Without money, your business won't function. It seems obvious, but it can be easy to let your financial guard down, especially when you are consumed by a specific project or projects, so dealing with financial issues should be a major part of your organizational plan right from the get-go.

How do you deal with all this as well as your creative and marketing requirements? It's not as hard as you think.

  • Invoice regularly : you need a healthy cash flow, so don't keep putting off the invoicing. One of the simplest ways of preparing your invoices is to use a template online from a company such as It saves you time designing your own, and it can be emailed to clients, stating your terms and conditions
  • Keep business records : you should keep every document relating to your business, whether it's hard copy or online. It's the only foolproof way to keep on top of how you are doing financially, and it is absolutely essential for preparing your end-of-year tax returns. If you keep your nose clean and keep a sound evidential base for all your income, outgoings, expenses, and taxes liable and paid, then it's highly unlikely that the IRS will come sniffing at your door. However, if your financial recordkeeping is haphazard and chaotic, it could get you into trouble.
  • Use a freelance : there are plenty of experienced bookkeepers and small business accountants out there who can help you without it costing you an arm and a leg. Employing a financial freelance enables you to free up time to dedicate to the creative side of developing your products.

Plans can change

All organizational plans change when different circumstances arise. Be flexible with how you run your business, be prepared to change - it's usually positive - and keep control of all the aspects you need to be, and continue to be, a successful developer.