The Air Navigation Order (ANO) is the bottom line. It's actually pretty readable and clear. The document is here:
http://www.caa.co.uk/docs/33/CAP393.pdf The relevant sections are 166 and 167.
The basics are that without explicit CAA permission:
Line of sight only. You need to be able to see it well enough to fly it and make sure you don't hit anything.
If over 7Kg (including batteries) you can't fly in controlled airspace, or near any airport, or more than 400' above ground.
You can't make any money from it.
If you've got a camera onboard, which you're not using just for FPV, you can't fly within 150m of a congested area, within 150m of a group of 1,000 or more people, within 50m of any person, vessel, vehicle or structure not under your control, except when taking off and landing in which case the limit is 30m.
With CAA permission, which only comes having provided (a) a "simple ops manual" and (b) demonstrated proof of flying ability, you are granted permission to earn money. In exceptional circumstances you can be granted permission to fly under different parameters than those listed above (i.e. the distance limits) but you'd need to be able to explain how you've analysed and justified the risk in doing so. The defacto standard permission limits you to 500m laterally and 400' (yes, mixed units) above ground.
With permission from the relevant controlling authority you can fly within the airspaces listed above, and within an air traffic zone.
