Within hours of the new rules emerging, MPs were back in the tea-room, calculating how best to work the system. Sir Christopher Kelly’s reform package creates a set of perverse incentives and dilemmas. Here is The Times’ guide on how different groups of MPs can “game” the system.

New MPs

MPs who live within 60 minutes of Westminster will have no option other than to commute daily. The rest have the choice of renting or living in a hotel. Business hotels within walking distance of the Palace of Westminster, such as the City Inn on Millbank, can accommodate MPs for the £120-a-night budget — so long as they book in advance. The £25 evening meal budget will go far in the Pizza Express downstairs.

MPs who own a property

Sell now, sell later or don’t sell at all — the biggest dilemma created by the report, with second-home owners potentially thousands of pounds out of pocket if they pick wrongly. Sir Christopher has ruled that MPs must rent rather than claim mortgage interest, with five years’ grace before the swap is enforced. But, starting immediately, all MPs who make money by selling properties part-funded by the taxpayer must return the proportion they claim on expenses. So MPs have four options:

• Don’t claim any mortgage interest: Some MPs are talking about an immediate end to mortgage interest claims, because they will only have to hand the money back later.

• Sell the property immediately: The downside is that property prices are still about 16 per cent below their peak, meaning that they could lose money on a sale.

• Sell after Christmas: Sir Christopher predicted that house prices were likely to rise before the five-year transition is up, offsetting any loss. But this will mean big bills to repay the taxpayer the amount they claimed to fund the property. How will this rebate be calculated? What happens if the house is owned jointly by husband and wife?

• Don’t sell until you stop being an MP: Those MPs who keep their second homes until the Parliament after next will be able to keep the proceeds of any sale after they stand down. But only those with deep pockets can do this since mortgage interest alone for a house you do not need could cost £60,000 over five years.

MPs who want to rent

Sir Christopher wants to give MPs the option of renting from a parliamentary housing agent. But would it be wise to take up this offer, or find a place themselves?

• MPs using the parliamentary housing provider are likely to be given a choice of two furnished one-bedroom flats. The agents will sort out council tax and utility bills, maintenance, management and other tedious tasks. But would you want to find Sir Patrick Cormack living next door?

• MPs can take the £1,250 on offer and find a place of their own, topping up from their own salary if necessary. The downside is the hassle — and the fact that Parliament will no longer pay for their washing machine or dishwasher. How will they keep clean?

MPs considering retirement

Sir Christopher proposes cutting the generous severance payment for retiring MPs from £40,000-£60,000 to just eight weeks’ pay — coming into force the election after next. This will create two perverse incentives:

• MPs who are considering retiring are more likely to become “bed blockers” and hold on.

• Meanwhile those want to stand down have no financial incentive to wait until a general election, triggering a by-election. Either way, a headache for party leaders.

MPs who employ their spouse

Sack, divorce, wife-swap or encourage them to take you to court? All these options are being discussed by MPs dismayed at Sir Christopher’s ban on employing spouses. Those not contemplating defeat are seriously discussing court action, saying that they might get their wives to sue them and then claim back the damages on expenses.

The winner

One of the few not to lose out from Sir Christopher Kelly’s report is a millionaire businessman. Adam Afriyie’s Windsor constituency is on the fringes of London and he is likely to be caught by the “60-minute” commuting rule that will bar him from claiming for a second property.

In fact, the Tory is a paragon of virtue, having voluntarily forgone his £23,000-a-year second home allowance. Nor does he employ a spouse or use any of the £10,000-a-year communication allowance. He has a second home in Westminster, which colleagues admire jealously, but funds it entirely out of his own pocket.

The loser

Adam Holloway could find himself nearly £40,000 less well off. The Tory MP lives in Gravesham, Kent, which may be deemed a “reasonable” distance to commute. Last year he claimed £22,587 on his second home allowance and £21,063 on the communications allowance. As a result of the furore, he gave up his rental accommodation.

“When I haven’t had a second home I’ve had to sleep on my father’s sofa,” he said. “Tonight I will be in the Commons for a vote at seven o’clock, I have a lot of work to do afterwards, and will probably end up sleeping on my office sofa. I’m 44 and it’s not what I was elected to do. I must be allowed some sort of life.”

Times Recommends

• The Olympics: you need brass to go for gold
• The new must-have accessory: 3-D specs
• Does Dame Helen Mirren need a Face Lift?