Simulating liquid phenomena utilizing Eulerian frameworks is challenging, since highly energetic flows often induce severe topological changes, creating thin and complex liquid surfaces. Thus, capturing structures that are small relative to the grid size become intractable, since continually increasing the resolution will scale sub-optimally due to the pressure projection step. Previous methods successfully relied on using higher resolution grids for tracking the liquid surface implicitly; however this technique comes with drawbacks. The mismatch of pressure samples and surface degrees of freedom will cause artifacts such as hanging blobs and permanent kinks at the liquid-air interface. In this paper, we propose an extended cut-cell method for handling liquid structures that are smaller than a grid cell. At the core of our method is a novel iso-surface Poisson Solver, which converges with second-order accuracy for pressure values while maintaining attractive discretization properties such as symmetric positive definiteness. Additionally, we extend the iso-surface assumption to be also compatible with surface tension forces. Our results show that the proposed method provides a novel framework for handling arbitrarily small splashes that can also correctly interact with objects embodied by complex geometries.