For one of the sites im running, Im trying to target the UK market. The site is hosted in the UK and is set to be UK in webmaster tools, but currently has a .com domain which is 3 years old and had 7 years left until expiry. I also own the .co.uk domain, but this has only been registered recently for 2 years. Do you think I should use the .co.uk to target the UK, but wont i be penalised then for having a young domain?
If you are targeting only UK then you should go with CO.UK it can help you to promote your keyword in UK market, I'm not saying .com can't get ranking in UK but co.uk is the best option for targeting UK market. Yes google sport old domain but it's depend on you how you will promote your site I have 6 month old domain and it is rank on his every keyword and doing well compare to old domain.
I think a .com can do fine in the UK even battling against .co.uk sites. My advice would be to stick with the .com since it will allow you to keep your options open in the future and attack the US, Australia, South Africa and any other English-speaking countries.
If you want uk traffic more than the global and better rank in uk. go for .uk domain. Also you can redirect your com to .uk.