GITA: The 60% Solar Tax Incentive Every Malaysian Company Should Claim Before Dec 31, 2026
GITA Application Window Closes 31 December 2026
Qualifying capital expenditure must be incurred and the MGTC application submitted by this date. Solar systems typically take 4–12 weeks to install; start the process by September 2026 at the latest.
What Is GITA? (30-Second Summary)
- GITA = Green Investment Tax Allowance. A Malaysian corporate tax incentive for companies that invest in qualifying green technology assets.
- For solar PV own consumption: 60% allowance on qualifying capital expenditure, set off against up to 70% of statutory income per year.
- Administered by MGTC (not MIDA) for solar own-consumption applications since January 2024.
- Deadline: 31 December 2026. Capex must be incurred and application submitted to MGTC within this window.
- Who qualifies: Malaysian-incorporated Sdn Bhd / Bhd companies that own and install solar for their own electricity consumption.
Every year, Malaysian manufacturers and commercial building owners pay millions in corporate tax that they could legally reduce — simply by investing in a rooftop solar system and claiming the Green Investment Tax Allowance (GITA). Most business owners have never heard of it. Their accountants often miss it. And the window closes on 31 December 2026.
This guide covers exactly what GITA is, the verified 2026 rates and rules, a worked example for a real factory-scale system, how it differs from GITE and from normal capital allowances, and the step-by-step application process. All facts are sourced from the official MGTC Green Technology Tax Incentive Guidelines (April 2024).
1. What Is GITA? (Full Explanation)
GITA stands for Green Investment Tax Allowance. It is a tax incentive under the Income Tax Act 1967, allowing Malaysian companies to claim an allowance on qualifying capital expenditure (capex) when they invest in approved green technology assets.
The allowance is set off against a portion of the company's statutory income each year, reducing the amount of income subject to corporate tax. Any unused allowance carries forward to subsequent years until fully absorbed — there is no arbitrary cap on carry-forward.
GITA covers two asset tiers under the April 2024 MGTC Guidelines. The tier relevant to solar PV for own consumption is:
GITA Asset Tiers (MGTC Guidelines, April 2024)
| Tier | Qualifying Assets | GITA Rate | Set-Off Limit |
|---|---|---|---|
| Tier 1 | BESS (Battery Energy Storage System), EV charging infrastructure, Green Buildings, MOF-approved Tier 1 assets | 100% | 70% of statutory income / year |
| Tier 2 ★ Solar | Solar PV (own consumption), energy efficiency equipment (chillers, compressors, VRV/VAV), waste recycling systems, rainwater harvesting | 60% | 70% of statutory income / year |
Source: MGTC Green Technology Tax Incentive Guidelines — GITA Asset (REG NO. MGTC/DC/REC/GTGT-007, Revision 4, 24 April 2024). Solar PV for own consumption is classified under Tier 2 / Appendix 2. Note: BESS (Tier 1) qualifies for 100% allowance — a separate incentive that can be stacked with a solar installation.
Important clarification: Several older resources state "100% capital allowance" for solar. This referred to the previous scheme (pre-2024) or to BESS (Tier 1). Under the current April 2024 MGTC Guidelines, solar PV for own consumption is Tier 2 = 60% GITA. Always verify against the current MGTC Guidelines document (April 2024) or consult your tax agent.
2. Worked Example: 100 kWp Factory Solar System
The following is an illustrative example using round numbers typical of a medium-sized factory. Actual tax outcomes depend on your company's tax position, taxable income, and applicable tax rate. Consult your tax agent for project-specific calculations.
Illustrative Example — 100 kWp Factory System
(round numbers, for illustration only)System Cost (Capex)
RM 300,000
~100 kWp installed, illustrative
GITA Allowance (60%)
RM 180,000
Set off over up to 5 years
Annual Set-Off*
RM 36,000
= RM 180K ÷ 5 years (subject to income)
| Item | Value |
|---|---|
| Solar system capex | RM 300,000 |
| 60% GITA allowance generated | RM 180,000 |
| Annual allowance set-off (RM180K ÷ 5 yrs, simplified) | RM 36,000 / year |
| Tax saved per year — SME rate (17%) | RM 6,120 / year |
| Tax saved per year — large co. rate (24%) | RM 8,640 / year |
| Total tax savings over 5 years (24% rate) | RM 43,200 |
| Effective net cost after tax savings | RM 256,800 |
* The actual annual set-off depends on your company's statutory income and the 70% cap — set-off cannot exceed 70% of that year's statutory income. Unused portions carry forward. Tax savings are in addition to ongoing electricity bill savings of RM12,000–RM18,000/year for a 100 kWp system at Malaysian commercial tariffs. This example is illustrative only; consult your tax agent for your specific position.
Scaled by System Size (Illustrative)
GITA Savings by System Size — Illustrative
| System Size | Est. Capex | GITA (60%) | 5-Yr Tax Saving (24%) |
|---|---|---|---|
| 50 kWp (small factory) | ~RM 150,000 | RM 90,000 | RM 21,600 |
| 100 kWp (medium factory) | ~RM 300,000 | RM 180,000 | RM 43,200 |
| 250 kWp (large factory) | ~RM 750,000 | RM 450,000 | RM 108,000 |
| 400 kWp (large warehouse/plant) | ~RM 1,200,000 | RM 720,000 | RM 172,800 |
All figures are illustrative estimates based on ~RM3.00/Wp installed cost and 24% corporate tax rate. Actual capex varies by roof type, location, and equipment spec. Use our GITA calculator for a project-specific estimate.
3. GITA vs GITE vs Normal Capital Allowance
Three different tax treatments are available for solar and green technology in Malaysia. Understanding which applies to your situation is critical before filing.
Tax Treatment Comparison
| Factor | GITA (Green) | GITE | Normal Capex Allowance |
|---|---|---|---|
| Who it is for | Companies buying solar for own use | Solar leasing / PPA operators | All companies — non-green assets |
| Benefit type | 60% of capex as tax allowance | 70% income tax exemption (up to 10 yrs) | ~3% per year over asset life |
| Administered by | MGTC (solar own-consumption) | MIDA | LHDN (self-assessed) |
| Deadline | 31 Dec 2026 | 31 Dec 2026 | No deadline |
| Can you own the system? | Yes (required) | No — lessor owns it | Yes |
| Applies to ATAP/NEM export? | No — ATAP is a separate SEDA scheme for export credits | Separate; not the same as GITE Solar Leasing | N/A |
GITA and GITE are mutually exclusive for the same project. Source: MGTC Guidelines April 2024; MIDA GITE Solar Leasing scheme.
Key distinction from ATAP/NEM: GITA is a corporate tax incentive for the investment decision. Solar ATAP (Accelerated Transition Action Programme) is a separate SEDA scheme that pays export credits when your solar panels send excess electricity to the grid. You can benefit from both simultaneously — GITA reduces your tax bill on the investment, while ATAP credits reduce your ongoing electricity bills. See our Solar ATAP 2026 guide for full ATAP details.
4. Who Qualifies for GITA (Eligibility Criteria)
The following criteria are drawn from the MGTC Green Technology Tax Incentive Guidelines (GITA Asset, April 2024). Your company must meet all of them:
Malaysian-incorporated company
Must be a new or existing company incorporated under the Companies Act 2016 and resident in Malaysia (Sdn Bhd or Bhd). Sole proprietorships, partnerships, and LLP structures do not qualify.
Asset used for own consumption — not income generation
The solar system must be installed on your business premises and used to reduce your own electricity consumption. A PPA arrangement (where another company owns the panels on your roof) does not qualify for your company.
New asset, owned by the company
The green technology asset must be new (not second-hand) and legally owned by the applying company.
Listed in MyHIJAU Directory (MGTC verification)
The qualifying asset must be approved by the Ministry of Finance, verified by MGTC, and listed under the MyHIJAU Directory. Your solar installer provides equipment specs and commissioning evidence; MGTC issues the verification letter.
Capex incurred between 1 January 2024 and 31 December 2026
The qualifying capital expenditure must be incurred within this window. The application must also be submitted to MGTC within 24 months of the capex date (36 months for Green Buildings).
Application submitted after commissioning
MGTC requires the application to be submitted after the solar system has been commissioned and is operational. For renewable energy projects, you must have received the relevant energy generation licence/approval first.
5. GITA Application Process (Step by Step)
Commission your solar system
Ensure the system is fully installed, operational, and has received the relevant TNB approvals. For systems above 24 kWp, this includes the Solar ATAP connection agreement.
Obtain required documentation
Your installer provides: IEC-certified equipment specs (IEC 61215/61730 for modules, IEC 62109 for inverters), commissioning report (IEC 62446), PE-endorsed drawings, and invoice/purchase evidence.
Submit MGTC GITA/A Form to MGTC
Send one set of the MGTC GITA/A Form with supporting documents to: Group Chief Executive Officer, Malaysian Green Technology and Climate Change Corporation, No. 2 Jalan 9/10, Persiaran Usahawan Seksyen 9, 43650 Bandar Baru Bangi, Selangor. Pay the processing fee (RM2,500–RM10,000 depending on capex value).
Receive MGTC verification letter
MGTC reviews the application and issues a verification letter confirming the asset qualifies. Do NOT submit any claim to LHDN (Inland Revenue Board / IRBM) before receiving this letter.
Claim via LHDN tax return
Your tax agent claims the GITA allowance in your annual income tax return (ITR). The 60% allowance is set off against up to 70% of statutory income each year. Unused allowance carries forward automatically.
6. GITA + Solar ATAP + Green Financing — The Full Stack
Savvy Malaysian manufacturers combine three incentives simultaneously to maximise the financial return on a commercial solar investment:
GITA
60% tax allowance
Reduces corporate tax liability on the capex. Claimed via MGTC + LHDN. Available until 31 Dec 2026.
Solar ATAP
Export bill credits
Surplus solar electricity exported to TNB earns credits on your electricity bill. Administered by SEDA. No Dec 2026 deadline.
Green Financing
From 3.5% p.a.
GTFS loans (Green Technology Financing Scheme) with MGTC interest rebate of 2% p.a. Available via Maybank, CIMB, RHB, Public Bank, BSN.
Combining all three: a factory finances its RM 750,000 solar system at 3.5% p.a., claims RM 450,000 in GITA allowance (saving ~RM 108,000 in tax over 5 years), and earns ongoing electricity savings of RM 50,000–80,000 per year. The net after-tax cost of the system falls substantially below the sticker price — and from day one, electricity savings typically exceed monthly loan repayments.
See our full solar financing options guide and GITA tax filing service for details on how Trexon handles the MGTC documentation end to end.
7. Common Questions (FAQ)
Does GITA apply if I use a PPA / SPPA (zero-capex model)?
No. Under a Power Purchase Agreement or Solar Power Purchase Agreement, the solar company owns the equipment and you pay for electricity consumed. Since your company does not incur the capital expenditure or own the asset, you cannot claim GITA. To qualify for GITA, you must purchase the system outright or via a hire-purchase / bank loan where you hold beneficial ownership.
Can I claim GITA and normal capital allowance on the same asset?
The GITA allowance and normal capital allowance cannot be claimed on the same capital expenditure for the same year of assessment. However, you can claim GITA on the portion qualifying as green tech, and Reinvestment Allowance or other allowances on different assets — subject to the conditions in the MGTC Guidelines (Section 5.1(g)). Your tax agent should review the interaction carefully.
What happens if my company does not have enough income to absorb the full GITA in Year 1?
The MGTC Guidelines explicitly state: "Unutilised allowances can be carried forward until they are fully absorbed." There is no 5-year hard cap on carry-forward; the limit is only on the annual set-off (70% of that year's statutory income). This makes GITA particularly valuable for companies with variable income, as the benefit is not lost — it simply defers to profitable years.
What is the MGTC processing fee?
Per the MGTC 2024 Guidelines: RM 2,500 for total asset cost under RM 500,000; RM 4,000 for RM 500,000–1,000,000; RM 7,000 for RM 1,000,001–5,000,000; RM 10,000 for above RM 5,000,000. This is a one-time government processing fee, separate from any professional fees charged by your tax agent or solar installer.
Does my solar installer need to be SEDA-registered?
The MGTC Guidelines require that the green technology asset be used in business carried out in Malaysia and that equipment meets IEC standards (IEC 61215/61730 for modules, IEC 62109 for inverters). In practice, all SEDA-registered installers (Registered PV Service Providers) supply IEC-certified equipment. Trexon Energy is a fully SEDA-registered RPVSP with complete MGTC documentation workflows.
8. Accuracy Notes — What the CEO Must Verify Before Publishing
Publisher review checklist before going live:
- 60% rate confirmed: Sourced from MGTC Guidelines Revision 4, April 2024 (Tier 2 / Appendix 2 = Renewable Energy System including solar PV). Verified against the official PDF (myhijau.my).
- Dec 31 2026 deadline confirmed: Stated in MGTC Guidelines Section 7 ("application received by MGTC from 1 January 2024 until 31 December 2026") and corroborated by MIDA announcement re: GITA Project merger. However: if Budget 2027 (typically announced Oct 2026) extends this deadline, the content should be updated immediately.
- 70% statutory income set-off: Confirmed in MGTC PDF table for both Tier 1 and Tier 2.
- MGTC (not MIDA) for solar own-consumption: Confirmed in MIDA announcement and MGTC Guidelines Section 8.
- Processing fees: Taken directly from MGTC Guidelines Section 6. Verify these have not changed if budget cycle has updated.
- Tax rate examples (17% SME / 24% large co.): Standard Malaysian corporate tax rates as of 2026; verify with your tax agent for any Budget 2026 changes to SME thresholds.
- GTFS 2% rebate / 3.5% rate: Referenced from MGTC GTFS scheme. Confirm current participating banks and rates have not changed.
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