In games created by the old "match" command (supported by all clients), handicap is setup after the game starts. Blacks first "move" is to setup the handicap stones. To do so, click the "Handicap" button in the glGo sidebar and enter the amount of handicap you wish to have. As alternative, you can enter the command "handicap 4" in the terminal window to get 4 stones for example. Only the black player can setup the handicap. If White disagrees with the handicap, he can Undo the first black move, which was the handicap setup.

When both players are using a client which supports the new "nmatch" command (PANDA-Egg and glGo as of writing this), the handicap can be defined before the game starts in the match dialog. You don't need to ask your opponent which client he uses, as glGo will automatically detect if your opponents client supports the "nmatch" command and then show you the advanced match dialog.