Ever had that sinking feeling when your accountant tells you what you owe and it’s way more than you expected?

You're not alone. For many Irish limited companies, surprise tax bills are one of the most common cash flow killers.

But here’s the good news: with a few simple habits, you can stay one step ahead and avoid those nasty surprises for good.

Why tax bills catch people off guard

Most tax shocks happen because of three things:

• No real-time financial data

• No regular check-ins or forecasts

• No visibility on upcoming liabilities

When you don’t know what’s coming, it’s easy to undersave or spend money that should have gone to Revenue.

1. Know what taxes are due and when

Every limited company in Ireland is responsible for:

✅ Corporation Tax – 12.5% of profits, due 9 months after year-end
✅ VAT – usually filed every two months, if registered
✅ PAYE – tax on salaries, due monthly if you run payroll

These taxes all have different timelines, which means without tracking, it’s easy to miss or miscalculate them.

👉 If you’re not already saving monthly, this post shows you how to set aside enough for tax.

2. Track your numbers in real time

If you're only reviewing your books at year-end, you're flying blind. Use cloud accounting software like Xero or a simple spreadsheet to:

• Track income and expenses monthly

• Monitor how much profit you're making

• Estimate your tax as you go

This gives you early warning signs and time to act.

Your pay strategy also affects your tax bill. If you’re unclear about whether to take a salary or dividends, 

👉 This guide will help you pay yourself without triggering unexpected liabilities.

3. Set money aside regularly

The easiest way to avoid panic is to build tax into your cash flow.

For example:

• Move 15% of your profits into a tax savings account

• Add 20–23% of VAT-inclusive sales if you’re VAT registered

• Save 30–40% of wages to cover PAYE liabilities

A separate Revenue savings account keeps it out of reach until it’s needed.

4. Don’t wait for your accountant to tell you

Most surprise tax bills happen because people only hear from their accountant once a year, after the return is due.

What works better:

• Monthly or quarterly check-ins

• Rolling forecasts that update with your business

• Proactive advice based on your real numbers

This is exactly how I work with clients at Thrive Digits. Want to chat? Book your call here.

Common traps to avoid

🚫 Assuming profits = cash
🚫 Forgetting VAT is collected on behalf of Revenue
🚫 Relying on past years to predict this year’s tax
🚫 Ignoring your Director’s Pay strategy (it affects your personal tax bill too)

Surprise tax bills don’t come from nowhere. They come from a lack of visibility. But you can fix that.

👉 Here’s a breakdown of the top cash flow issues and how to solve them

Final thoughts

Tax bills shouldn’t be a surprise.

With real-time numbers, a solid savings habit, and a proactive accountant by your side, you can finally feel in control and actually plan ahead with confidence.