satphone:
Much appreciated. My accountant is going nuts!
Not the only one. Me too.
I couldn't make much sense of the code on the site that was using the 'credit note' setting. The code has been hacked almost beyond recognition, SO, I went back to my notes and the code that used the 'Standard' setting for Re-calculate tax and discovered that this was behaving the way you've described.
I then compared the current ot_coupon code with a copy from an older (also live) server that I have access to (and knew worked as expected) and noticed a minor, but very important difference. I made the same change to the current code, and am now getting the expected results. Hooray!!!
The change:
/includes/modules.order_total/ot_coupon.php
Line #457 ... which reads like..
$od_amount['tax'] += $od_amount['tax_groups'][$key];
Just add a couple of slashes // in front of the line to comment it out. (you can also just delete the line, but I prefer to comment out because it may come in handy someday, as it did this time).
Save the file, and all should work as expected. (settings, include tax = false, Re-calculate tax - standard)
Cheers
RodG