Malaysian businesses have a hard deadline staring them down: December 31, 2026. By that date a solar installation must be commissioned and its Green Investment Tax Allowance (GITA) application submitted — a 60% tax allowance on your qualifying capital expenditure. For a factory spending RM 500,000 on solar, that means a RM 300,000 allowance against your statutory income. This guide tells you exactly how to claim it before the window closes.
What is GITA? The Green Investment Tax Allowance Explained
GITA Asset is a Malaysian government incentive administered by the Malaysian Green Technology and Climate Change Corporation (MGTC) through MyHIJAU. It provides a 60% allowance on qualifying capital expenditure incurred on green technology assets verified by MGTC — including solar photovoltaic systems.
Unlike a tax rebate (which reduces tax payable directly), a tax allowance reduces your statutory income (up to 70% of it each year). This means the actual tax saved depends on your company's effective tax rate:
- Company tax rate: 24% (standard Sdn Bhd)
- RM 500,000 solar investment × 60% GITA = RM 300,000 allowance
- RM 300,000 × 24% tax rate = RM 72,000 in actual tax saved
- Effective after-tax cost of your RM 500,000 system: RM 428,000
Qualifying SMEs pay lower rates (15% on the first RM 150,000 and 17% on the next RM 450,000 of chargeable income), so the same allowance is worth less to them in tax. Either way, GITA improves your solar return and shortens the payback period. Confirm the figures with your tax agent.
GITA Solar Eligibility: Who Qualifies?
Not every business automatically qualifies. GITA Asset is for companies, and MGTC checks your company and project against the guideline criteria.
Company Requirements
- Incorporated in Malaysia under the Companies Act 2016
- Tax resident in Malaysia
- The solar installation must be for your own business consumption — not for resale or as a service to third parties
Project Requirements
- Solar PV system must be commissioned and the GITA application submitted by 31 December 2026
- The asset must be verified by MGTC and listed on MyHIJAU
- Installation should be carried out by a SEDA-registered PV service provider
- The GITA Asset application is submitted to MGTC after commissioning, and must be submitted by 31 December 2026
Critical note: Trexon is a SEDA-registered PV service provider. We provide the itemised invoice and commissioning documents for the MGTC application. Request a factory solar quote and we will set out the GITA documentation in the quote.
GITA Calculation Examples by System Size
The following examples use Malaysia's standard corporate tax rate of 24%. Prices are at Trexon's commercial rate of RM2,400/kWp before SST. Tax savings are lower at the SME rates, and they arrive later for a company with losses, because unused allowance is carried forward.
| System Size | Approx. Investment | 60% GITA Allowance | Tax Saved (24%) | Effective Cost After GITA |
|---|---|---|---|---|
| 50kW | RM 120,000 | RM 72,000 | RM 17,280 | RM 102,720 |
| 100kW | RM 240,000 | RM 144,000 | RM 34,560 | RM 205,440 |
| 200kW | RM 480,000 | RM 288,000 | RM 69,120 | RM 410,880 |
| 500kW | RM 1,200,000 | RM 720,000 | RM 172,800 | RM 1,027,200 |
| 1MW | RM 2,400,000 | RM 1,440,000* | RM 345,600 | RM 2,054,400 |
* The allowance is set off against up to 70% of statutory income each year. Any unused allowance is carried forward to subsequent years until it is fully absorbed.
How GITA Interacts with TNB Savings
GITA does not exist in isolation. Combined with the energy charge your factory no longer pays TNB, it shortens the payback period noticeably. On MV General the energy charge is 29.83 sen/kWh; the Maximum Demand (MD) charge of RM 89.27/kW is billed separately and is not counted below, because one cloudy 30-minute window can set the month's MD.
Consider a food manufacturing plant with:
- Monthly TNB bill: RM 45,000
- Monthly MD charge component: RM 12,400 (139kW peak demand × RM 89.27)
- 200kW solar installation: RM 480,000 + SST (RM 2,400/kWp)
Combined returns over Year 1:
- Energy savings (about 252,000 kWh a year, all used on site, × 29.83 sen): about RM 6,260/month = about RM 75,200/year
- MD charge reduction: not counted (solar alone does not reliably lower MD)
- GITA tax saving: up to RM 69,120 once the allowance is fully used
- Simple payback: about 6.4 years without GITA
- Simple payback: about 5.5 years with GITA
See our B2B solutions page for more on factory solar.
Step-by-Step GITA Claim Process
The GITA claim process involves three parties: MGTC (asset verification), your installer (documentation), and LHDN (tax filing). Here is the complete sequence.
Phase 1: Quotation and Planning
- Obtain solar system quotation from a SEDA-registered PV service provider (like Trexon)
- Confirm the equipment is listed on MyHIJAU so the asset can be verified by MGTC
- Plan the timeline so the system is commissioned with enough time to file before the deadline
Phase 2: Installation and MGTC Application
- Installation by a SEDA-registered PV service provider following TNB grid connection requirements
- TNB Solar ATAP commissioning completed
- Installer issues Commissioning Certificate — keep this; it is required for the MGTC application and tax filing
- Submit the GITA Asset application to MGTC after commissioning — it must be submitted by December 31, 2026
Phase 3: Tax Filing (Year-End)
- In your Year of Assessment 2026 company tax return (Form C), declare the GITA allowance in line with section 127(3)(b) of the Income Tax Act
- Attach: MGTC confirmation, commissioning certificate, invoices, and payment proof
- GITA allowance reduces statutory income (up to 70%) for YA2026 — remainder carries forward to YA2027 and beyond until exhausted
- File with your auditor — GITA is a standard item for any tax-savvy corporate tax agent
Why December 31, 2026 Is a Hard Deadline
The current GITA Asset guideline covers qualifying capital expenditure incurred from 1 January 2024 to 31 December 2026, and the system must be commissioned and the application submitted by 31 December 2026. No extension is confirmed. Budget 2027 (tabled 9 October 2026) proposes extending GITA Asset to purchases verified by MGTC up to 31 December 2030, but standalone solar is not on the proposed list. Solar integrated with battery storage would qualify at 100% of qualifying capex, set off against up to 70% of statutory income, with the application made within 24 months of purchase. These are proposals, subject to legislation and not yet gazetted. Past solar incentive programs (SolaRIS, NEM 3.0) have ended on their gazetted dates.
This is not a soft deadline. Companies that miss the December 31, 2026 commissioning and submission deadline lose GITA eligibility entirely for that system — the allowance cannot be backdated or retrospectively claimed.
Timeline: Can You Still Make the Deadline?
The system must be commissioned and the MGTC application submitted by 31 December 2026 — and TNB grid connection and the construction timeline eat into the time left fast.
| Activity | Typical Duration | Note |
|---|---|---|
| Booking to TNB commissioning | Residential reference: about 6–10 weeks; larger systems take longer | Includes approvals; on-site installation time depends on system size and is stated in your quotation |
| GITA Asset application to MGTC | After commissioning | Must be submitted by 31 Dec 2026 |
| Deadline | — | Commissioned and submitted by 31 Dec 2026 |
The earlier you start, the more margin you have for TNB and construction delays before the December 31 deadline. Do not gamble with your GITA tax benefit.
Ready to secure your GITA before it expires? Get your factory solar quote from Trexon today. We provide the itemised invoice and commissioning documents you need for the MGTC application.
