WESTMINSTER’S standards watchdog must investigate SNP backbencher Phil Boswell over what “appears to be a clear breach of the code of conduct” for MPs in relation to his financial interests, a Liberal Democrat peer has insisted.

Lord Purvis of Tweed made his call after his party colleague Paul McGarry, a Lib Dem list candidate for Central Scotland in next year's Holyrood election, complained to Kathryn Hudson, the parliamentary commissioner for standards, over Mr Boswell’s alleged actions.

She is now dutybound to undertake a preliminary inquiry to see if there is a case for a full probe. If an MP is found to have broken parliamentary rules, he or she can be suspended or even expelled from the Commons.

Earlier this month, the Nationalist MP for Coatbridge, Chryston and Bellshill was accused of hypocrisy after admitting that he had benefitted from a tax avoidance scheme despite campaigning against such schemes since arriving at Westminster after his victory in the May General Election.

Mr Boswell received an £18,309 interest-free loan from a former employer, "repayable on demand", as part of his role as a contract manager in the energy sector.

He explained the payment was "common practice" in the industry.

Since his election, Mr Boswell has called on Chancellor George Osborne to close tax loopholes and complained that tax dodging has cost the UK economy nearly four times as much as benefit fraud had.

But Scottish Labour, which has already called on HM Revenue and Customs to investigate Mr Boswell’s activities, claimed people would be “astonished by the apparent hypocrisy of Phil Boswell with him preaching about the evils of tax avoidance while appearing to have taken advantage of a tax avoidance scheme himself".

The SNP has now confirmed the MP has been in touch with HMRC to discuss his tax position.

The Commons register of members’ interests is meant to provide information about any financial interest an MP has.

It is suggested Companies House records show Mr Boswell is the sole director of Boswell and Johnston Ltd but his register of interests’ entry fails to mention the company nor any interest-free loans or dividends he might have been paid through this firm.

Lord Purvis said: “The First Minister has previously said that we must be ‘unequivocal about how obscene and immoral and downright wrong’ it is to avoid tax. The First Minister cannot remain silent over these allegations. If she can justify or explain Mr Boswell’s actions she should do so. If not, she needs to condemn them. People will think that her words on tax avoidance were utterly meaningless unless she acts,” declared the Lib Dem peer.

The SNP insisted Mr Boswell had “declared all interests in line with the rules, including all relevant income”.

The Herald tried to contact the MP for a comment but there was no response.