123 reg is cheapest for .co.uk's that i know of, but don't accept paypal. But a .com for $6.99 @ domain site, using paypal.
I think regfly may accept paypal as well.
Namecheap appear to accept PayPal. They're not the best on .co.uk pricing, but $8.88/yr isn't half bad for .com pricing and they're currently offering their "WhoisGuard" privacy protection service for free with all registrations and transfers (Note: This is kind of redundant with .uk domains where you can choose to opt-out of having your details available in the WHOIS database, but it's handy for other extensions).
There are also some Namecheap coupons floating around, I believe
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