I was in a similar situation when I moved into this house. The previous owner had had Pipex Homecall installed so we decided to take over the account. After 5 weeks of them telling me random things about the ownership of the account, we ditched them. BT wanted �125 to switch the line back to them. So we went with NTL (now Virgin Media) as their phone service comes from their own line. All done and dusted in a week!
So, my advice is cancel Talk Talk and don't tell BT anything. You'll have 2 sockets in the house though. One for the redundant 'BT' line and the new Virgin one.