Templates / Service Agreement

Service Agreement / Freelance Contract

Service agreement and freelance contract template for India. IP ownership, payment terms, deliverables. eSign for ₹15.

businesseSign eligible

Download PDF Sign with Aadhaar eSign — ₹15

What is a Service Agreement?

A service agreement (or freelance contract) is a legal agreement between a service provider and a client that defines the terms of a professional engagement. It establishes the scope of work, payment terms, intellectual property ownership, and other conditions. In India, service agreements are governed by the Indian Contract Act, 1872. A critical distinction in Indian law is whether the service provider is an independent contractor or an employee — this affects TDS deductions (Section 194J vs 192 of the Income Tax Act), labour law applicability, and benefits eligibility.

Essential Clauses in a Service Agreement

Scope of services/work with clear deliverables
Duration/timeline of the engagement
Compensation — fixed fee, hourly rate, or milestone-based payments
Payment terms (invoicing, due dates, TDS deduction at source)
Intellectual property ownership of work product
Confidentiality obligations
Termination clause with notice period
Independent contractor status (not an employee)
Indemnification and limitation of liability
Governing law and dispute resolution

Download & Sign

Download the template PDF below
Fill in your details (names, dates, addresses, amounts)
Upload the completed PDF to SignSetu
Add all signers and send for Aadhaar OTP signing
Signed document delivered in under 2 minutes

Download PDF Sign This Service Agreement

₹15 per signature. No subscription.

Stamp Duty & Registration

Service agreements generally do not attract stamp duty in most Indian states, as they are classified as agreements for services rather than instruments of conveyance or transfer. However, if the agreement includes a consideration above a certain threshold or involves specific property-related services, stamp duty may apply. Check your state's stamp duty schedule.

Can a Service Agreement Be Signed with Aadhaar eSign?

Yes. Service agreements and freelance contracts are fully eligible for Aadhaar eSign under Section 3A of the IT Act, 2000. For freelancers and consultants working remotely, eSign is especially convenient — both parties can sign from anywhere without meeting in person.

Learn more in our Complete Guide to Aadhaar eSign →

Common Mistakes to Avoid

✗Not clearly establishing independent contractor status — this has major tax implications (TDS under Section 194J for contractors vs 192 for employees)
✗Vague scope of work leading to scope creep and disputes
✗Not addressing IP ownership — by default, the creator owns the IP unless explicitly assigned
✗Missing payment milestone triggers or unclear invoicing terms
✗Not including a termination clause — both parties should be able to exit with reasonable notice

Frequently Asked Questions

How is a service agreement different from an employment contract?

A service agreement establishes an independent contractor relationship — the provider controls how work is done, uses their own tools, and can work for multiple clients. An employment contract creates an employer-employee relationship with control over work methods, fixed hours, and statutory benefits. This distinction is critical for tax (TDS) and labour law purposes.

Who owns the intellectual property created under a service agreement?

By default under Indian Copyright Act, the creator owns the copyright. To transfer IP to the client, the agreement must explicitly assign intellectual property rights. This clause is essential in any service agreement.

What TDS rate applies to freelancer payments?

Payments to independent contractors/freelancers are subject to TDS under Section 194J of the Income Tax Act at 10% for professional/technical services. The client must deduct TDS and issue Form 16A.

Can a service agreement include a non-compete clause?

Non-compete clauses are generally unenforceable under Section 27 of the Indian Contract Act. However, non-solicitation clauses (preventing the contractor from poaching the client's employees or customers during the engagement) are more likely to be upheld.

Is a service agreement valid without stamp paper?

Yes, in most states service agreements do not require stamp paper. They are valid as contracts under the Indian Contract Act. However, admissibility as evidence may be affected in some states if stamp duty is technically applicable but unpaid.

Disclaimer

This template is for informational and reference purposes only and does not constitute legal advice. Laws and regulations change periodically. This template may need modification based on your specific circumstances and state laws. Consult a qualified legal professional before executing any legal document. SignSetu is not responsible for any consequences arising from the use of this template. Last updated: April 2026.

Governing Law: Indian Contract Act, 1872

Related Templates

NDA

NDA template for India — unilateral and mutual. Free PDF with confidentiality clauses. eSign with Aadhaar for ₹15.

Consultancy Agreement

Consultancy agreement template for India. Scope, fees, IP ownership, and TDS clauses. eSign for ₹15.

Ready to sign?

Upload your completed service agreement and eSign with Aadhaar in under 2 minutes.

Sign Your Service Agreement

₹15 per signature · No subscription · No DSC token

What is a Service Agreement?

Essential Clauses in a Service Agreement

Scope of services/work with clear deliverables

Duration/timeline of the engagement

Compensation — fixed fee, hourly rate, or milestone-based payments

Payment terms (invoicing, due dates, TDS deduction at source)

Intellectual property ownership of work product

Confidentiality obligations

Termination clause with notice period

Independent contractor status (not an employee)

Indemnification and limitation of liability

Governing law and dispute resolution

Stamp Duty & Registration

Can a Service Agreement Be Signed with Aadhaar eSign?

Common Mistakes to Avoid

✗Not clearly establishing independent contractor status — this has major tax implications (TDS under Section 194J for contractors vs 192 for employees)

✗Vague scope of work leading to scope creep and disputes

✗Not addressing IP ownership — by default, the creator owns the IP unless explicitly assigned

✗Missing payment milestone triggers or unclear invoicing terms

✗Not including a termination clause — both parties should be able to exit with reasonable notice

Frequently Asked Questions

How is a service agreement different from an employment contract?

Who owns the intellectual property created under a service agreement?

What TDS rate applies to freelancer payments?

Payments to independent contractors/freelancers are subject to TDS under Section 194J of the Income Tax Act at 10% for professional/technical services. The client must deduct TDS and issue Form 16A.