Veteran Tory Bill Cash said today he was prepared to pay back more than £15,000 claimed for the rent of a London flat owned by his daughter, and did not intend to resign over the issue.
Tory leader David Cameron warned that Mr Cash faced "serious questions" and needed to co-operate with inquiries.
Mr Cash designated a flat owned by his daughter Laetitia, an aspiring Tory MP, as his "second home" for Commons allowances during 2004
and 2005 – even though he owned a home closer to Westminster, the Telegraph said.
The MP for Stone, whose main home is a country house in Shropshire, said he did not live at his Pimlico flat or rent it out at the time.
The Telegraph said Miss Cash sold her Notting Hill flat for a £48,000 profit soon after her father stopped claiming money for it.
She had owned her home for less than a year and a half, and for more than 12 months of that period her father had paid her £1,200 a month in rent from public funds.
Today Mr Cash said that his one-bedroom flat in Pimlico had been occupied by his son Sam during the period in question.
While the MP was living in her flat, Laetitia was fighting the general election in Salford and living "at our family home in Shropshire as well as moving around a great deal", Mr Cash said.
He told Channel 4 News at Noon that he was prepared to pay back the money.
"I will pay the money, it is my intention in the circumstances, yes," he said. "But I obviously need to look at the situation as it develops."
He later said that he would not make the same claim today.
"I happen to think in retrospect that if I was asked would I do it now, the answer is: I don't think I would, but that would be on the matter of judgment," he told ITV News.
"As it happened, at that time, it was within the rules – and furthermore I don't say that because the rules are the rules – but I had to be somewhere to discharge my parliamentary duties."
Mr Cash took part in a series of interviews today after Mr Cameron spoke out against him on a campaign visit to Cumbria this morning.
Mr Cameron told reporters: "I think Bill Cash has got some very serious questions to answer and he needs to answer those questions.
"He needs to co-operate with those inquiries. Everyone knows the consequences of not participating. I've made that very clear."
Pressed on Mr Cameron's statement that he had "very serious questions to answer", Mr Cash told Sky News: "I dare say that is true, but what I am saying is that I have done what I have said in relation to the rules as they were."
He said he did not believe there was "any financial advantage to be gained" by his arrangement.
Asked whether he expected to stand for the next General Election, he said: "I personally do. But I do think it's important to go through the process in a proper manner not necessarily driven by the media on 24/7 but actually to go through the documentation and paperwork."
