GITA 2026: A 60% Tax Allowance for Companies Installing Solar (Worth Up to 14.4% of Cost)

Malaysia's Green Investment Tax Allowance (GITA) is a significant corporate solar incentive that many Malaysian SME owners have not heard of. Under GITA, a company that installs a qualifying solar PV system can claim a 60% allowance (GITA Asset, Tier 2) on the qualifying capital expenditure — reducing its tax payable, worth up to 14.4% of the cost at the 24% corporate rate once fully used.

This guide explains GITA from first principles: what it is, who qualifies, how to calculate the tax saving, how to apply, and how to stack it with other incentives for maximum benefit.

What is GITA? The Legal Foundation

GITA is governed by the section 127(3)(b) of the Income Tax Act 1967 (GITA Asset, administered by MGTC). The current GITA Asset guideline covers qualifying capital expenditure incurred from 1 January 2024 to 31 December 2026 on green technology assets listed on MyHIJAU, including solar PV systems, battery energy storage, EV charging systems and energy-efficient equipment. The system must be commissioned and the MGTC application submitted before 31 December 2026.

Critically, GITA is an allowance set off against statutory income, not a deduction of the whole cost in one year:

• Allowance: 60% of the qualifying capital expenditure (Tier 2 for solar) is set off against your statutory income, up to 70% of statutory income in any year. Any unused allowance is carried forward until it is fully absorbed.
• Tax value: the tax saved is the allowance multiplied by your tax rate. At the 24% corporate rate, 60% of the qualifying cost is worth up to 14.4% of that cost once fully absorbed.

GITA is for companies. It is not available to homeowners.

GITA Solar: Key Terms and Conditions (2026)

How GITA Works: A Step-by-Step Example

Here is an illustrative scenario (a hypothetical company, not a Trexon customer). Scenario: Engineering SME, Petaling Jaya

• Annual statutory income: RM 800,000
• Tax rate: 24% (standard corporate rate, simplified for this example)
• Solar installation: 50kWp rooftop system at RM 2,400/kWp = RM 120,000 (before SST)
• Year of installation: 2026

Year 1 Tax Calculation (Without GITA)

• Statutory income: RM 800,000
• Tax payable: RM 800,000 × 24% = RM 192,000

Year 1 Tax Calculation (With GITA)

• Statutory income: RM 800,000
• GITA allowance available: RM 72,000 (60% of solar capex, Tier 2)
• Maximum offset in Year 1: RM 800,000 × 70% = RM 560,000
• GITA applied: RM 72,000 (fully absorbed in Year 1, below the 70% cap)
• Revised taxable income: RM 800,000 − RM 72,000 = RM 728,000
• Tax payable: RM 728,000 × 24% = RM 174,720
• Tax saved via GITA: RM 17,280

A 50kWp system generates about 5,250 kWh a month. If all of it is used on site, that saves about RM 1,566 a month (about RM 18,800 a year) on an MV General tariff at RM 0.2983/kWh, or about RM 2,661 a month (about RM 31,900 a year) on a Non-Domestic Low Voltage tariff at RM 0.5068/kWh. This counts no maximum-demand saving. With the RM 17,280 tax saving, the first-year benefit is about RM 36,000 (MV) to RM 49,000 (LV), before SST.

Important note: GITA reduces your effective cost of the solar installation. A RM 120,000 system that saves RM 17,280 in tax (60% Tier 2 allowance at the 24% corporate rate) has a net cost of RM 102,720, before SST and before electricity savings are counted. This shortens the payback period. Subject to MGTC verification.

What Qualifies as GITA-Eligible Solar Expenditure?

Not every line item on your solar invoice qualifies. Here is what typically qualifies as capital expenditure under the GITA Asset guideline (MGTC verifies each item; confirm with your tax agent):

• Qualifying: Solar PV panels, inverter(s), battery storage system, mounting and racking structure, AC/DC cabling, monitoring system hardware, SCADA equipment, switchgear and protection devices
• Qualifying (with documentation): Civil and structural works directly required for the solar system (e.g., roof strengthening, concrete ballast pads)
• Usually not qualifying: Professional fees (engineering, legal), application fees, SST, installation labour (unless capitalised as part of asset cost per FRS 116)

Your solar installer should provide an itemised invoice that clearly separates qualifying asset costs from service fees. Trexon's commercial quotations itemise asset costs separately from service fees.

GITA Application Process: How to Apply

Step 1: Commission the System, Then Apply to MGTC

After your solar installation is commissioned, submit the GITA Asset application to MGTC (Malaysian Green Technology and Climate Change Corporation, formerly GreenTech Malaysia) through MyHIJAU with your system specifications, installer credentials, invoices and commissioning documents.

The application must be submitted by 31 December 2026. Subject to MGTC verification.

Step 2: Receive MGTC Confirmation

MGTC verifies the asset and confirms the qualifying allowance. MIDA is not part of the GITA Asset route for solar own-consumption — it handles GITA Project and the GITE solar leasing scheme.

Step 3: Claim in Your Annual Tax Return

In your company's income tax return (Form C), declare the GITA allowance as advised by your tax agent. Keep MGTC's confirmation and the asset purchase documentation. Your tax agent handles the specific LHDN form format.

Stacking GITA with GTFS: Maximum Benefit Strategy

GITA can be combined with the Green Technology Financing Scheme (GTFS) — a government guarantee scheme (GTFS 5.0, for companies) covering 60–80% of the green-technology portion of a bank loan, with no interest rebate. A possible structure:

1. Finance the solar system with a GTFS-eligible bank loan (government guarantee on the green-technology portion; no interest rebate)
2. Claim the 60% GITA Asset allowance (Tier 2) on the qualifying system cost, subject to MGTC verification
3. Use electricity savings to service the loan
4. After loan repayment, all electricity savings flow directly to profit

In the best case, a company finances the system with a guaranteed bank loan, sets off 60% of the qualifying cost against statutory income (up to 70% a year, unused allowance carried forward), cutting the effective net cost by up to about 14.4% at the 24% corporate rate once fully absorbed, and uses the electricity savings to repay the loan. Check the bank's own product page for its current terms.

For more on stacking incentives, see our guide: Complete Solar Incentives Malaysia 2026 — Every Scheme Explained.

GITA vs Green Income Tax Exemption (GITE): Which is Better?

A separate incentive called the Green Income Tax Exemption (GITE) offers tax exemption on statutory income from green technology activities. GITE applies to companies that generate and sell green energy (e.g., IPPs, CGPP participants) rather than companies installing solar for self-consumption. If your business sells excess solar to TNB or third parties under a PPA, your tax consultant should evaluate whether GITE provides more value than GITA in your specific situation.

Who Should Act Now

The current GITA window closes on 31 December 2026. To claim the allowance, your qualifying solar assets must be commissioned and the application submitted by this date. Companies considering solar should:

1. Get a commercial solar quote from Trexon — see our commercial solar solutions page
2. Confirm GITA eligibility with your tax consultant before proceeding
3. Ensure your installer provides GITA-compatible documentation (itemised invoice, MGTC application support)
4. Budget 6–10 weeks from quotation to installation completion — leaving time to submit the MGTC application before year-end

Trexon provides the itemised invoice and installation documents you need for the MGTC application. Contact us for a commercial proposal.