New (to the board) tax preparation expert here to answer your questions

You also need to review the UK tax return reporting because the rental income (gross) forms part of income potentially reportable on the UK tax return.  The UK will look to local law to establish your beneficial interest in the gross income and your share of deductions.  The UK position will depend therefore both on State law and the contract.  What you don't want to find out is that you owe no tax in the US but do owe tax in the UK.  

My understanding is if I BRING the income over to the UK then yes..I don't bring it here since it stays in a US bank account and the mortgage is paid from that - I actually transfer money to that account to pay the "loss" of the amount I dont make on the rent.

My understanding is if I BRING the income over to the UK then yes..I don't bring it here since it stays in a US bank account and the mortgage is paid from that - I actually transfer money to that account to pay the "loss" of the amount I dont make on the rent.

If you pay UK taxes on the NonDom basis, then yes, you may be correct (provided, of course, you pay the £30,000 due to HMRC). If you pay UK taxes on the arising basis, in my opinion, this should at least be considered when completeing your UK tax return.

I believe it would be better if everyone started their own topics for questions as we do in the other forum boards please, thank you.

Good Idea Leah - I was confused with multiple answers...

I've split the new question to a new topic here and locking this one:
http://talk.uk-yankee.com/index.php?topic=67427.0