If someone suggested you pay a few hundred dollars a year more than you have to, to your power company, on the understanding that you will get a refund at the end of the year, you would probably think they were mad.

But a lot of people still operate this way with their tax bills.

They pay more than they have to throughout the year - in some cases, significantly more - and wait for the end of the tax year to get the difference back.

We are at that time of year now - have you discovered you are one of them?

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Paying more than you need to is easy to do. Provisional tax is calculated on the basis of last year's earnings, plus 5 per cent, so if you do not do anything, the amount you have to pay keeps going up.

If you just keep paying what you are told to, you will end up with bigger tax bills, irrespective of whether your income increases to warrant it.

But in this era of technology and automation, there is no excuse for relying on these sorts of one-size-fits-all estimates, especially if they mean you are going to pay more than you have to and are left with less money in your pocket as a result.

You should be able to use your bookkeeping software to get a clear idea of what your business income really is, how that compares to the previous year's, and what your tax bill will be for the year.

You could also check in more regularly with your accountant, who should be able to tell you how you are tracking.

This is a time when having good systems in place can really pay off.

Reducing your tax bills to more accurately reflect your income should improve your cashflow.

You can use the money to pay off expensive debt or to offset interest if you have an overdraft facility for your business or personal finances.

- Jeremy Tauri is an associate at Plus Chartered Accountants