VATLP23950 - Option to tax - anti-avoidance test: what is the meaning of 'eligible purposes'?: what about occupation by government departments and local authorities?
Occupation of a building by a body to which VATA 94 section 33 applies (such as a local authority) is deemed to be for eligible purposes to the extent that occupation is for non-business purposes. Occupation by a government department (within the meaning of section 41) is always deemed to be for eligible purposes.
Further guidance regarding section 33 bodies can be found in .