The Home Secretary was put under increasing pressure yesterday when an investigation began into claims that she is misusing her parliamentary housing allowance.

Jacqui Smith has been criticised for designating her sister's house in London as her “main home”, allowing her to claim more than £20,000 a year for her “second home”. She has claimed at least £116,000 in second-home allowances for her constituency home in Redditch, Worcestershire, where her family live.

John Lyon, the Parliamentary Commissioner for Standards, said yesterday that he had accepted a complaint involving information from Ms Smith's London neighbours, who contacted David Cameron's office. Last week Mr Lyon turned down two earlier requests.

The decision to look into Ms Smith's housing arrangements follow allegations by a couple who live in the same street, Dominic Taplin, a businessman who used to be co-owner of the London nightclubs Abigail's Party and Legends, and his wife Jessica, a manager for a charity. They live four doors from Ms Smith and say that she is often there for as few as two nights a week and spends little time there during the long parliamentary recesses.

Mrs Taplin, 33, told a Sunday newspaper: “When I read that she says she spends most of the week here, I thought, 'That is a fabrication'.”

Mr Taplin, 46, who works from home, said: “You can tell when she is here because the police guards arrive first. They turn up mid-morning on Monday and leave mid-morning on Thursday. I cannot recall when they have been here any other nights of the week. I find her behaviour extraordinary.”

The couple claimed that Ms Smith did not stay in her London home during the summer recess or at Christmas.

Under the additional costs allowance, MPs can claim more than £23,000 a year in expenses on the upkeep and running of a second home, but nothing on a main home. The MP must designate the residence where they spend the bulk of their time as their “main home”.

Ms Smith said that she would robustly fight the accusations. Her spokeswoman said that during the parliamentary week she would arrive at her sister's house on Sunday or Monday and would usually go to Redditch on Thursday. She spent much of Parliament's long recesses, including the three-month summer break, at the London property.

Ms Smith's staff said that if she stayed there as few as two nights a week, as the Taplins had claimed, this would mean her being absent from votes, the front bench and other important political functions. They said that the presence of a police officer outside the house was no guide to when she was at home.

Ms Smith said yesterday: “I sought advice about the arrangements that I make for living in two places like lots of MPs have to. I followed the advice that I was given and I followed the rules, and therefore I'm very happy to answer further questions that the independent commissioner puts to me.”

Home and away

What has Jacqui Smith done?

She has designated her family home in Redditch as her second home – the property on which MPs can claim up to £24,000 in expenses. She claims that her “main home” is her sister’s house in London, where she is a lodger. Some neighbours say that she does not spend much time there

What do the rules say?

MPs’ rules state: “Your main home will normally be the one where you spend more nights than any other”

What happens if the identity of your main home is ambiguous?

According to a special report last year, the Parliamentary Commissioner for Standards wants to apply the test of value for money for public funds to decide cases where there is doubt about which is an MP’s main home

Does Jacqui Smith stay there more than any other?

She claims that she does, but at least one set of neighbours disagrees. Claims that Ms Smith was not in London over Christmas or in recess are wrong, her office insists. It may produce her diary to show how often she is in London

What happens if she is found guilty of breaching the rules?

She could be sacked and forced to pay back the money. This appears unlikely, however, since she checked her arrangements with the parliamentary finance department as recently as 2007

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