You after surround sound and EAX etc? Or are you more keen on good quality stereo sound? Ultimately, do you use the PC mainly for games or for music?
For stereo, you could pick up a second hand amp and speakers off the bay. Couple this with a studio type stereo soundcard for a good music setup (a good stereo card is the M-Audio 2496, and at £50, you'll have more cash for the speakers too )
For surround your probably looking at one of the X-Fi cards and a 5.1 computer speaker set (Logitech Z-5400 seems most suitable for your budget). This will not sound as good for music though since your money is going into surround support.
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