The Christmas period should be a time for family and fun. But this year it also marks the close of several government schemes designed to help crunch-hit consumers and to reboot the economy. An end to these sweeteners means that it may be worth bringing certain significant purchases forward to the coming weeks. Here, Times Money explains.

Big-ticket shopping

Value added tax (VAT) is set to revert to 17.5 per cent from its current reduced rate of 15 per cent on January 1. This will add only a few pence to the cost of cheaper goods such as CDs, but £25 to a product retailing at £1,150 and hundreds of pounds to the price of most new cars.

There are free calculators at vatcalculator.org.uk to help you to work out the difference in price based on tax at the 15 and 17.5 per cent rates.

Bruce Fair, of kelkoo.com, the shopping comparison website, says that white goods and summer holidays are common “big-ticket” January purchases that people should consider bringing forward. The best time to buy will be between Christmas and the new year, when you can benefit from both the VAT saving and the “January” sales, most of which now begin on Boxing Day.

Cars and vans

The Government extended its car scrappage incentive this month with an extra £100 million of funding. The scheme is set to end when this money runs out or on February 28, whichever is sooner.

Peter Lawton, of What Car? magazine, says that the scheme is unlikely to be extended further and that now is a good time to buy. “You get the scrappage and VAT savings, and should be able to haggle even more off mid and high-priced cars,” he says. “The scrappage discount is especially significant on city runarounds, such as the Fiat 500 [from £6,700 with the saving]. Dealers are unwilling to discount much on cheaper models with small margins.”

The magazine’s website at whatcar.com features “target” prices, which Mr Lawton says give an idea of the discounts that you can achieve on any new model after brief negotiation.

Other cars going cheap include the Toyota Aygo, described as a “charming, well-built and supremely frugal city newcomer” in its Times review, and now starting at £5,785. This would increase to £7,955 after the scrappage scheme ends and VAT rises.

Under the scheme, motorists can claim £2,000 off the cost of a new car or van when they trade in a qualifying older vehicle. Cars must have been registered on or before February 29, 2000, and vans on or before February 28, 2002. Either must have been registered in your name for at least 12 months, and you must have a current MOT test certificate.

Stamp duty increase

The Government’s temporary increase in the stamp duty threshold from £125,000 to £175,000 is due to end on December 31. The tax is payable at 1 per cent, so the saving available in the meantime is between £1,250 and £1,750. While the deadline might seem a reasonable way off, buyers wishing to take advantage of the discount should consider the lengthy processing time for mortgage applications. For example, Nationwide says that the average mortgage application it handles takes 39 working days to arrange (there are now only 27 working days left).

Despite this, Melanie Bien, of the mortgage broker Savills Private Finance, says that lenders will work hard to accommodate tighter timescales. She says: “If you crack on this week, lenders will be able to process most applications in time. It’s faster if you use a broker — about a calendar month from the offer to completion.

“However, the tax saving is worthwhile only if you are buying anyway and know what you want. There is no point in rushing a huge decision for a discount of less than £2,000.”

A second caveat is the chance that the Government will extend the deadline or make the £175,000 threshold permanent in its Pre-Budget Report on December 9. Mike Warburton, of Grant Thornton, the firm of accountants, puts the odds of such a move at 50:50.

House-price movements may also influence your decision on whether to fast-track a purchase. Most surveys indicate slight increases in recent months, although thoughts of “recovery” seem premature.

Martin Ellis, of Halifax, says: “House prices increased by 1.2 per cent in October, marking the fourth con-secutive monthly increase. Nationally, house prices have risen by 2.9 per cent since the end of 2008. They are now 7.1 per cent higher than the April trough.”

Case study: On the road to a good deal

Toshikatsu Azami took advantage of the scrappage scheme to trade his old Mercedes for a new Toyota Prius.

The 62-year-old hotel manager, who lives in Finchley, North London, says: “My old car was worth about £600 or £700, so trading it in for a £2,000 discount was a great deal. My wife has also used the scheme to trade in her Nissan Micra for a Toyota Auris.”

The Prius starts at £17,090, including savings of £2,000 with the scrappage allowance, and £370 with the lower VAT rate. Because the car is a hybrid, with low carbon emissions, Mr Azami no longer has to pay road tax or the London congestion charge of £8 a day.