The amount which would otherwise be payable under paragraph 1 of this Schedule shall be reduced by such part, if any, of that amount as may reasonably be attributed to any part of the house occupied for any purposes other than those of a private dwelling at the date of the making of the compulsory purchase order, demolition order, closing order, clearance order or order under paragraph 2 of Schedule 2 to the M1Land Compensation Act 1961.

Any question arising under this paragraph as to the purposes for which any part of a house was occupied shall be determined by the Minister, and subject thereto the amount of any payment under paragraph 1 of this Schedule in respect of an interest shall be determined (in default of agreement) as if it were compensation payable in respect of the compulsory purchase of the interest under Part III of the Act of 1957, and the payment shall, subject to sub-paragraph (3) of this paragraph, be dealt with as if it were such compensation.

Any such payment in respect of an interest which, at the date when the house was purchased compulsorily or, as the case may be, vacated, was held by virtue of an agreement to purchase by instalments shall be made to the person entitled to the interest at that date.