There's no option in QuickBooks Online to change the "Payment" label to "Credit Memo" on printed invoices. The system treats applied credits as payment transactions that reduce the outstanding balance, and this label is a fixed part of the standard invoice template that cannot be customized.
As a workaround, you can include a note in the Note to customer field on the invoice to let clients know that the credit applied is a credit memo, not a payment.
You can also consider sending a customer statement, which lists all transactions and highlights credit memos as separate line items. This clearly shows how credits are applied to the invoice balance and helps prevent confusion about the payment label.
You’re welcome to reach out anytime if you have further questions or concerns. We’re always here to help.
