Nick Clegg has donated nearly £40,000 of profits from the sale of his constituency home to the taxpayer.
The Deputy Prime Minister has sold his four-bedroom semi-detached house in Sheffield and is now renting a two-bedroom flat.
He said that although he was allowed to keep the profits under current expenses rules, he wanted to "lead by example" and encourage other MPs to "get out of the property game".
The house in Bents Green, in the south west of the city, was bought in 2006 for £280,000 and has finally been sold for £325,000 after going on the market in September last year.
The profit is £38,750 after fees and other costs are deducted.
The Liberal Democrat leader told the Sheffield Star he had written a cheque to the House of Commons.
He said: "There has been a profit for the taxpayer and, as I promised before the election last year, it will be returned to the taxpayer."
He added: "It's not something that is required of me and I expect not all other MPs will do the same but it's my personal choice to lead by example.
"I don't want to be holier than though about it but the old expenses system made people very angry. MPs should get out of the property game and it's something I pushed for."
Mr Clegg bought the house after becoming MP for Sheffield Hallam in 2005. The identity of the new owner has not been revealed.
Asked about his new home in Stannington, west of Sheffield, Mr Clegg said: "It's a two-bedroom flat and I love it. The Rivelin Valley is a great area too.
"It would be great to go down to the river to throw stones in the water with the kids when I bring them up here."
Mr Clegg's main home is in Putney, south-west London, which he shares with wife Miriam Gonzales and their three young sons.
Expenses rules introduced by the Independent Parliamentary Standards Authority (Ipsa) mean that MPs will no longer be able to claim mortgage payments towards their second homes after August next year.
They are instead being encouraged to rent smaller properties.
Mr Clegg pledged during the general election campaign last year that "every single penny" of profit made from the sale of his Sheffield home would go to the taxpayer.Reuse content