How do coupon codes work with one time and recurring billing cycles.

Can you please explain how coupon codes work.

Our one-time (30 days) and recurring (every 30 days) subscription prices are $5.99 each. We would like to offer a discount coupon of $4.99, making the membership only $1 to entice new subscribers to sign up.

Please explain what happens at the next recurring billing cycle. We are using, paypal single gateway and payment standard gateway.

Does the member get charge the regular subscription price at the next billing cycle?

Please respond as soon as possible.