Cabinet minister Alan Johnson has been forced to give back a £1,675 donation after it emerged it came from someone not registered to vote.
He must also pay the same sum into public funds after failing to check in time whether the money was permissible and tell the authorities.
But the Electoral Commission said it will not take legal action against the politician after accepting it was an inadvertent "oversight".
Mr Johnson received £1,675 in August last year from a Mizra Begg, who was not on the electoral register and therefore not allowed to donate.
But the money was not returned to him until December - well outside the 30-day limit - and neither was it reported to the Commission on time.
Because of the late declaration, Mr Johnson must hand over the sum to the authorities even though the donation has been returned.
The money will go into public funds.
The Health Secretary raised thousands of pounds last year to fund an unsuccessful bid to become Labour deputy leader.
The watchdog said it "accepted that this was an oversight and that there was no intention to break the rules.
"Mr Johnson has agreed to forfeit the sum of £1,675 and therefore legal action by the Commission is not necessary." it "accepted that this was an oversight and that there was no intention to break the rules".Reuse content