SolvedVATLP23940 | Option to tax - anti-avoidance test: what is the meaning of 'eligible purposes'?: what about occupation by doctors, schools, universities and other types of businesses who make predominantly exempt supplies?
From HM Revenue & Customs · VAT Land and Property
As these businesses would not be occupying the land for wholly or substantially wholly eligible purposes, the input tax incurred is normally not recoverable.
There are, however, some exceptions, such as the use of a building by a university for taxable research.