[alistairSH]

The difference is that the company that contracted you isn't managing your day-to-day work.

Company hires you and says "we need a website that does X" and leaves you to do it. You might be a contractor/free-lancer.

Company hires you and says "we need a website that does X, you need to work in the office and/or use our hardware, and we want it written in React, and you'll be working closely with JimBob the Manager." You are probably not a contractor/freelancer.

Yes, there's some grey area in there. It's a combination of the three factors in the ABC test that determines employee vs contractor.

[PorterDuff]

"Yes, there's some grey area in there."

From my experience, I've never seen a software contractor that could avoid being considered an employee if the eyes of the state government fell upon them closely.

[ska]

  I've never seen a software contractor that could avoid being considered an employee...

There are lots of them. Consider a company that doesn't produce software at all hiring you to build an app for them. or a company that has no expertise in your area, etc.

If you are embedded in a team and could swap roles with any of them, you probably aren't a really a contractor though.