How to Increase Your Rates as a Service Provider (Legally and Confidently)

Increasing your rates as a service provider can feel uncomfortable especially if you work closely with your clients or have been charging the same prices for years. But one of the biggest advantages of running your own business is that you get to set your rates and adjust them as your experience, expertise, and value grow.

A question I hear all the time is:

Is there a “right” or “wrong” way to raise your rates as a freelancer or service provider?

From a legal perspective, there actually is. And from a relationship perspective, how you handle a rate increase matters just as much as the number itself.

In this post, we’ll walk through:

• When it makes sense to raise your rates

• How to increase your rates legally and professionally

• How your client contract should support you in doing so

• How to communicate the change without damaging trust

When Is It Time to Increase Your Rates as a Service Provider?

Before you raise your prices, it helps to understand why you’re doing it. Here are some of the most common—and legitimate—reasons service providers increase their rates.

1. Your Expertise and Value Have Increased 

As you gain experience, training, certifications, or industry knowledge, the value you bring to clients increases, even if the work takes you less time than it used to.

A common trap service providers fall into is thinking:

“If this takes me less time now, I shouldn’t charge more.”

That mindset leads directly to burnout. Efficiency is not something you should penalize yourself for. You are not selling time, you are selling expertise, judgment, and results.

Raising your rates to reflect your value is not only reasonable, it’s necessary for sustainable growth.

2. You Want Fewer Clients at Higher Rates

Many service providers intentionally move toward a quality over quantity model: fewer clients, deeper work, higher fees.

If that’s your goal, raising your rates is often unavoidable. Whether you charge hourly, by project, or through retainers, the math has to work so you can meet your income goals without overextending yourself.

This is especially common for:

• Retainer-based services

• VIP days or intensives

• Ongoing advisory or management roles

Higher-touch services generally command higher fees—and clients often expect that.

3. Growing Your Own Team

If you’re bringing on subcontractors, assistants, or other team members, your business expenses increase, but so does the value you can deliver.

Being able to offer broader expertise, faster turnaround times, or expanded services is a strong justification for increasing your rates. Your pricing should reflect not just your labour, but the infrastructure supporting your work.

How to Increase Your Rates Legally (This Is Where Many People Get It Wrong)

It’s completely normal to worry about losing clients when you raise your rates. As someone who regularly hires service providers myself, I can tell you: clients generally expect rates to increase over time.

That said, you can’t always increase your rates whenever you want—especially with existing clients. Your ability to do so depends heavily on your contract.

How Your Contract Should Support Rate Increases

Whether or not you want to increase your rate right now, I highly recommend including language in your contract that allows you to do this. 

Ideally, your client agreement should make it clear that:

• The current rate applies for a defined period or scope

• Rates are subject to review or increase at renewal or extension

• Changes must be agreed to in writing

This kind of language sets expectations early and makes future conversations significantly easier.

Without it, many service providers end up stuck charging early-business rates to long-term clients—and resentment often follows.

Fixed-Term vs. Ongoing Agreements

If your contract has a fixed term (for example, a one-year agreement), you generally cannot increase your rates mid-term unless:

• The scope of services changes, and

• Both parties agree to the change in writing

Raising rates unilaterally during a fixed term can put you in breach of contract.

If your agreement expires and renews, that renewal point is usually the appropriate time to introduce a new rate.

What If Your Contract Is Silent or There Is No Term?

This happens more often than people like to admit.

If your services are project-based, the cleanest option is to raise your rates between projects and issue a new agreement (or an amendment) before the next one begins.

If you provide ongoing services without a fixed term, best practice is to:

• Provide clear, advance notice (often 30 days or more)

• Communicate the increase professionally and transparently

• Give the client the opportunity to decide whether to continue

Open communication and reasonable notice are your guiding principles here.

Timing and Communication Matter More Than You Think

Raising your rates is as much about how you communicate as when you do it.

As a general rule:

• Avoid raising rates too soon after onboarding a client

• Avoid waiting so long that resentment builds

• Align increases with natural milestones (renewals, calendar years, scope changes)

If you’re unsure, it’s worth getting legal advice and then updating your contracts going forward so future increases are easier to manage.

How to Communicate a Rate Increase Professionally

Clear communication helps preserve strong client relationships—even when the answer is “no.”

Most service providers give at least 30 days’ notice, or longer if their contract requires it. This gives clients time to:

• Assess their budget

• Decide whether to continue

• Transition if needed

It also gives you time to fill the spot if a client chooses not to move forward.

Not every client will be able to continue at your new rate and that’s okay. A rate increase naturally creates space for clients who better align with your current value.

Prepare for the Conversation

Preparation builds confidence.

Before raising your rates, be ready to explain:

• How your services have supported the client’s goals

• What results you’ve delivered

• What additional value or expertise you now bring

Metrics, reports, outcomes, and testimonials can all support this conversation. These same insights can also strengthen your portfolio and attract higher-paying future clients.

If email is your primary mode of communication, starting the conversation there is perfectly acceptable—just make sure any agreement is formalized properly afterward.

Always Get the New Rate Agreed to in Writing

This part is non-negotiable. But of course you knew I was going to say that!

Once a client agrees to a rate increase, it should be documented in writing. The cleanest way to do this is through an Amending Agreement, which formally updates the pricing (and any related changes, like scope).

While email confirmation is better than nothing, things get lost. A signed amendment ensures:

• Everyone is on the same page

• The change is enforceable

• Your records are clean and organized

Update Your Website, Portfolio, and Materials

After increasing your rates, make sure your public-facing materials reflect the change. Inconsistent pricing across proposals, websites, and portfolios creates confusion and undermines confidence.

Make updating these assets part of your standard process whenever your pricing changes.

Final Thoughts

Raising your rates as a service provider can feel uncomfortable—but it’s also a sign of growth. If you’re doing good work, most clients expect that your rates will evolve over time. And when a client can’t continue at your new rate, that transition often creates space for better-aligned opportunities.

Your contract plays a critical role in making these changes smoother and less stressful. That’s why all of our client service agreement templates include clauses designed to support rate increases, renewals, and amendments—so you can grow your business without constantly renegotiating from scratch.

You can explore our full collection of lawyer-drafted service agreements here. Each template is designed for Canadian and U.S. freelancers and service providers and built to support long-term, sustainable growth.