£516 will bag you a brand new VW Racingline spring and damper set from Awesome GTI which is good value imo! I wouldn't personally entertain second hand suspension unless it's really low mileage. You can't tell if someone has smacked their car up a kerb and blown a damper valve, so it's a bit of a gamble!
Stage 1 software is rarely on offer unfortunately, so that'll be around £400-£500ish if custom or Revo.
There's always bargains on ebay! You can look at fitting alloy wishbones and hubs from a B6 Passat or S3 to go with the suspension, which are cheap. I paid £45 delivered for a pair of hubs! They're about £300 each new from VW.
I think there's a few induction kits in the classifieds!
Loads of options! I reckon it will feel superb on new suspension and you'll enjoy the car more, which will give you more time to save up for the expensive tuning stuff!