Philip Ryabchenko: “When one owns a large fortune, it is a major mistake to do nothing with it at all”

Representatives of large Russian businesses know how to earn capital, but they do not always manage to pass it on by inheritance. Alexey Ilyukhin, co-founder of ITSWM, a consulting company, and Philipp Ryabchenko, managing partner of BIEL, a law firm, told Kommersant how to pass on a business to heirs through foundations, while avoiding typical mistakes and significant tax consequences.

One of the main and most frequently used intra-family instruments is, naturally, a marriage contract, then a will and personal and private funds, foundations and other instruments. An effective tool for the inheritance planning and risk management is life insurance policies. Insurance policies often act as a proxy for a trust. It is very important to get advice from a specialized lawyer in time, who will choose the right jurisdiction for the tool, explain the nuances of its management and properly draw up the documents, ultimately allowing one to avoid a lawsuit.

The biggest and most important mistake that can be made when owning a large fortune is to do nothing at all, or have a nominee holder of assets, or enter into fictitious marriage contracts or other agreements. Similar mistakes are also made with respect to personal foundations and trusts.

It is always advisable to choose independent companies that specialize in estate planning and value their impeccable reputation as managers. When choosing a jurisdiction, first of all, it is worth starting from the current place of residence of the beneficiary and his family members, as well as their medium-term and long-term plans.