Hi Scott,
been following PC hardware for >10 years now and up to date with current events.
Suggestions:
CPU
Socket 1150 -
Intel Xeon E3-1231 v3
Haswell, Quadcore, 22nm, Hyperthreading, 3,4Ghz normal, 3,8 with Turbo
on market since May of this year, replacement for 1230 v3
+ very good price/performance ratio
+ Xeon CPUs are perfectly fine for private consumer grade desktops and pc gamers
+ 23% increase to i5 2500K (~16% to OC 2500K)
- no free multiplikator (K models)
- Overclocking only up to ~4Ghz feasable
- no integrated graphics unit
Benchmarks /Performance comparison:
http://www.computerbase.de/2014-05/intel-xeon-e3-1231-v3-nachfolger-1230-test/2/ (hover over cpu names to see % comparisons)
Wattage and Temperature:
http://www.computerbase.de/2014-05/intel-xeon-e3-1231-v3-nachfolger-1230-test/5/
Hierarchy chart:
http://www.tomshardware.com/reviews/gaming-cpu-review-overclock,3106-5.html (further information, Xeons are not listed)
Mainboard
Gigabyte GA-H97-D3H
specs:
http://geizhals.at/eu/gigabyte-ga-h97-d3h-a1107992.html
on market since May this year as well
features you know from your current mainboard
+ dual bios
+ solid capacitors
new ones:
+ (native) USB 3.0
+ (native) 6x SATA 6Gb/s
+ HDMI 1.4
+ 1x M.2 10Gb/s (new interface for SSD drives)
full specs:
http://www.gigabyte.com/products/product-page.aspx?pid=4962#sp
M.2 SSD support list:
http://download.gigabyte.eu/FileList/Document/mb_m.2_support.pdf
CPU Support List (does support Xeon 1231 v3)
http://www.cpu-upgrade.com/mb-Gigabyte/GA-H97-D3H(rev._1.0).html
http://www.gigabyte.com/support-downloads/cpu-support-popup.aspx?pid=4962 (forth from bottom for the Xeon)
RAM
you may even keep yours
RAM support list:
http://download.gigabyte.eu/FileList/Memory/mb_memory_ga-h97-d3h.pdf
Any 8 Gb Kit with 1600 or 1866Mhz will do, preferably 1.50V modules.
-------------------------
Even if you decide to go with new RAM modules as well, all three components will be well within your 500 pound budget.
Notes
I know you have a budget and the opportunity to upgrade right now, however looking at the numbers, the performance difference between the i5 2500K and the Xeon 1231 isn't that great. Generally speaking and contrary to popular belief, the RAM does not has a tangible impact on performance. You're fine with 8 Gb of DDR3, 1333/1600 Mhz, 1.5V. A new mainboard sounds like the best option from my standpoint.
Another thing to consider is a SSD for the OS and games with high loading times, if you don't have one already. Modern SSDs, like the Samsung 840, are already limited by the 6Gb/s SATA bus, that's why the H97 features the M.2 interface to install a faster drive today or down the road.
Furthermore, Intel will be releasing brand new desktop CPUs (Broadwell and Skylake) middle of next year.
http://www.computerbase.de/2014-06/broadwell-und-skylake-mit-parallelem-desktop-start/ (click on first image)
The question is, can you wait and upgrade to a new socket (1151), 14nm and DDR4 next year?