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For reading PDF, I would recommend a larger screen. As you're in the UK, that expands your horizons a bit. I understand the Onyx e-ink readers are easily available there.
For more mainstream, I'd recommend the Kobo Aura One or Aura H2O.
Not sure about annotations. Haven't tried annotating PDFs. However, both the Onyx and Kobo readers are somewhat flexible; it's possible one of the alternative PDF readers out there like Koreader would do the job.
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