Nitrates are the bi-product of nitrites which are in turn a bi-product of ammonia. The bacteria in your live rock feed on the ammonia that is generated from fish waste, uneaten food and any other decaying organic matter, breaking it down in nitrites initally and then into nitrates.
As Nemo says, nitrates aren't so much of a problem in a FO or FOWLR marine aquarium as the fish are much more tolerant to it than freshwater fish. However, invertebrates and corals are affected by it, so if you are planning on keeping them in the future then a 40ppm nitrate level is "toxic".
Live rock will only break ammonia down into nitrates, it will do nothing to combat it, similarly with adding additional filtration, as this again just provides a home for aerobic bacteria to perform the nitrogen cycle. Frequent water changes will help to reduce the levels, provided that the RO water you are using has a TDS reading of 0 ppm, so check your RO machine to confirm this. If its not, then the new salt water may be a source of nitrates itself.
A protein skimmer fitted to the tank will go a long way to reducing nitrates in the tank, by removing dissolved organic waste from the water column and depositing it into a collection cup. If you don't have one, it would be very beneficial on a tank your size.
If you have a sump, then having a refugium would also be a good idea. If you don't, then you can grown macro algae in the display tank. Chaetomorpha is an excellent choice and a great way to reduce nitrates and phosphates in the tank and the beauty of it is that it just gets more efficient the more it grows. It also doesn't go sexual like caulpera can and overtake your aquarium. You could also grow other types, like some of the very attractive red algae. Chaetomorpha also provides a home for amphipods and other small creatures.
Another thing you could do, if you have a sump, is to have a deep sand bed section. This will provide a home for anaerobic bacteria that actually do feed on nitrates. DSB do require maintenance as they can "crash" but, they can dramatically reduce nitrate levels without the need for expensive pouches and refills. Used in conjunction with macro algae nitrate levels can reduced to virtually undetectable levels.
Since you only have one fish, I'm wondering if you are overfeeding it, as the nitrate levels do seem a bit high for a tank the size you have, with such a low stocking list. A sure fire way of reducing nitrates is to reduce the amount of ammonia that is generated in the first place. Sometimes its not just the amount of food that you feed your fish but, the way in which you feed them. Very often, food gets blown around the tank, falling into places that are inaccessible to the fish and will lie there and rot, unless consumed by a hermit crab, snail, bristleworm of another member of your clean up crew.
For example, I feed my clownfish on 2mm pellet food. I can feed them 10 pellets which the fish will completely consume if I drop them in individually at a rate of 1 every 3-4 seconds. If I drop 10 pellets into the water at once, maybe 5 will get eaten. The rest fall to the sandbed which the fish won't touch. Here the pellets begin to dissolve, releasing organic water into the water. Also, if you are feeding frozen food, like brineshrimp or marine mix, defrost it in some RO water, strain and then feed these sparingly to the fish. Not allowing the "juice" to enter the tank will also go a long way to stopping nitrate building up.
Ammonia, although toxic to aquatic life, isn't necessarily a bad thing. Without it, the bacteria in your live rock would die off as it had no source of nutrients. What you are aiming for is achieving an equillibrium, whereby the amount of ammonia entering the water is sufficient enough to feed the bacteria which will eventually produce nitrate. The nitrate can then feed anerobic bacteria and macro algae. Obviously cyanobacteria and hair algae will also feed upon this and may result in algae blooms but, they will be outcompeted by a DSB and macro alges eventually, and themselves will be a food source for snails and hermit crabs.
I hope that makes sense and help you reduce your nitrate levels
*Edit* Just re-read this thread and noticed that you already have a protein skimmer, which I missed the first time around
