David Cameron suffered embarrassment yesterday after it emerged that his local Conservative Party was forced to forfeit a donation it accepted from a supporter in Guernsey.

Witney Conservative Association had to give up the donation of £5,900 after failing to make basic checks that would have shown that the donor was not entitled to vote in a British election and so not entitled to make a political donation.

Mr Cameron’s local party also had to surrender a second donation, worth £1,500, from a supporter in London who was not on the electoral roll and therefore was also impermissible as a donor.

The association forfeited the money to the Electoral Commission on November 16 – a week before Labour was engulfed in a scandal over secret donations made through third parties.

Labour’s leader in Scotland, Wendy Alexander, has also been under intense pressure after accepting a donation of £950 towards her leadership campaign from a businessman in Jersey. One of her front-bench team resigned as a result.

Mr Cameron’s local party in Oxfordshire accepted both donations at a fundraising event in August. The first was a gift in kind of a holiday, which was valued at £1,500 and was donated by Geoffrey Dobbs, from London, as a prize for an auction.

Roger Fletcher, from Guernsey, bid £5,900 to win the auction for the holiday with his payment going to the local party.

The association in Witney failed to carry out the most basic checks required, within 30 days, on local donations above £200 under the Political Parties, Elections and Referendums Act 2000. The rules state that donors must be entitled to vote in Britain or run a company that is carrying on business in the United Kingdom.

Since the larger sum came from a man with an address in Guernsey his donation fell foul of the rules.

Had the party made the discovery that the donor was ineligible within the 30-day period the donation could have been returned to the original donor, which is the most common outcome in such cases.

But Witney Conservatives accepted both gifts and registered them with the Electoral Commission.

The alarm about the larger donation was raised when an official from the regulator made a routine compliance check.

A commission spokeswoman said: “We then spoke to the Witney association and they came back and confirmed to us [that] a second donation to the association was also from an impermissible source.”

Since the 30-day limit had passed, the money was forfeited to the commission, which passed it on to the Treasury’s consolidated fund.

Yesterday Witney Conservatives referred inquiries on the matter to the party’s headquarters in London, where a spokesman said: “As soon as we became aware that these two donations were not permissible, we declared and voluntarily forfeited them to the Electoral Commission.”

The Witney constituency, on the eastern edge of the Cotswolds in rural Oxfordshire, is one of the biggest and wealthiest Conservative associations, with 24 branches dotted around its towns and villages and 1,380 members.

Its income last year was £121,800 and the association is rich enough to have loaned £100,000 to the national party.

Times Recommends

• Time-worn Freddie gives up Test matches
• Brighton company 'involved in cyber attack'
• The art of survival: it's all in the mind