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The Conservative Party says its co-chairman Baroness Warsi has been cleared of allegations she wrongly claimed Parliamentary expenses.

Baroness Warsi's claims were probed by the Lord Commissioner for Standards.

It was alleged that in 2008 she claimed overnight expenses for staying in London while living rent-free.

Last month she was cleared of a breach of the ministerial code after being accompanied by a business associate on an official visit to Pakistan.

In a statement, Lady Warsi said she was "delighted" to draw a line under the matter.

Prime Minister David Cameron said he was "pleased" the allegations had been dismissed and it cleared the way for Lady Warsi to lead the Tory campaign for the election of police and crime commissioners later this year.

Lady Warsi said: "I believe that being a member of the House of Lords is a privilege and I take that privilege seriously.

"I have always maintained that the allegations surrounding my expenses were untrue and I am delighted that Paul Kernaghan has dismissed them.

"His report and the report by Sir Alex Allan - two independent inquiries - have now drawn a line under these matters and my only focus now will be to get on with my job."

A House of Lords spokeswoman said: "The Commissioner for Standards has written to Baroness Warsi advising her that he would be submitting a report on her case to the Sub-Committee on Lords' Conduct in early August.

"He stated that he had dismissed the allegation that she had wrongly claimed expenses for overnight accommodation costs in London."

A separate part of the allegation was that the baroness had declared on the register of ministerial interests rental income from a property, but not declared it on the register of Lords' interests.

The Lords spokeswoman said the commissioner judged she had breached the code by failing to "properly" register the property but noted "she had already written to the chairman of the Sub-Committee recognising that failure and apologising for it".

The commissioner "would be recommending that that apology, along with her corrected entry in the Register, constituted appropriate remedial action and that no further action was required".

The Sub Committee on Lords' Conduct will consider the commissioner's report in the autumn, before the Privileges and Conduct committee formerly publishes it.

Labour said it was "disingenuous" of Baroness Warsi to say she had been cleared of any wrongdoing.

"This is not true - there was a lack of transparency about her living arrangements for which she has been rightly criticised," said frontbencher Michael Dugher.

"She was found in breach of the ministerial code and the government has repeatedly failed to answer the Parliamentary questions that I have submitted in relation to her."