If you're willing to try a refurbished laptop, then this £450 Lenovo Yoga from Amazon UK is worth looking at:
https
/www.amazon.co.uk/Lenovo-YOGA-Intel%C2%AE-Hybrid-Drive/dp/B00SKUQUCE/ref=sr_1_89?s=computers&ie=UTF8&qid=1511466603&sr=1-89&refinements=p_36%3A40000-50000%2Cp_n_feature_browse-bin%3A1481781031%7C1481785031%2Cp_n_feature_fifteen_browse-bin%3A8322531031%7C8322530031
If you can look past the fact that it's refurbished/used/pre-owned, you do get quite a lot of goodies, such as a 2K IPS touch-screen and the practical 2-in-1 design. The OS is Windows 8.1 but you can still upgrade to Windows 10 for free using a few loopholes, like this one:
http

/www.pcgamer.com/you-can-still-upgrade-to-windows-10-for-free-thanks-to-loophole/
Also, if you're concerned with buying refurbished in general, you could make use of Amazon's contact features and call the vendor for more info.
If you absolutely must have a brand-new laptop with touch functionality at under £500, I suspect it's going to be 10" tablets or Chromebooks.
Cheers,
GreyCatz.