Has anyone come across this issue? after creating an invoice for payment and saving and submitting it says it is applying a previous credit as if paid on it as a deposit

It seems like the feature to automatically apply credits is turned on, Aecleaningsoluti.

Once it's turned on, an open invoice is paid automatically if a customer has existing credits or unapplied payments. 

We can go ahead and check the settings. Here's how:

1. Click the Gear icon.
2. Select Account and Settings.
3. Go to the Advanced tab.
4. Click the Pencil icon in the Automation row.
5. Verify the Automatically apply credits box is checked. 

You can uncheck the box if you wish to turn off the feature, then click Save, and Done. 

If you want to unlink the credit or unapplied payment to the invoice, I'll guide you how:

1. Open the invoice, then click the Payment link.
2. Select the date to open the Receive Payment page. 
3. Under Credits, uncheck the credit or unapplied payment.
4. Click Save and close. 

Then, you can record the invoice payments manually. 

I'll share this article on how enter and apply credit memos and delayed credits in QuickBooks Online as additional reference. 

Get back to this thread if you have additional questions. We'd be pleased to work with you again.