A contractor agreement and consultancy agreement are similar.

A contractor agreement is an agreement between a company (usually referred to as the “principal”) and a service entity (usually referred to as the “contractor”) where the contractor agrees to provide a service to the principal for a fee.  The contractor may agree to provide a one-off service for a set fee or continuing services to the principal for a pre-determined length of time for a fee.  An example of a contractor agreement is an agreement between a builder and tradesperson, where the tradesperson is engaged to perform their trade on a building site.

A consultancy agreement is an agreement between a company (usually referred to as the “principal”) and a consultant (usually referred to as the “consultant”).  The consultant may be an individual or a company.  The consultant is engaged by the principal and agrees to perform consultancy services to the principal for a fee.  The consultant may agree to perform the consultancy services on a one-off basis for a set fee or on a continuing basis either for a pre-determined length of time for a fee or as required for a set fee.  An example of a consultancy agreement is an agreement between a company and an IT consultant, where the IT consultant has expertise in IT services and is engaged by the company to provide those services to the company.

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