diff --git a/src/num.jl b/src/num.jl
index 5d0a3bac0..c3d3101e8 100644
--- a/src/num.jl
+++ b/src/num.jl
@@ -78,9 +78,18 @@ end
 substitute(expr, s::Pair; kw...) = substituter([s[1] => s[2]])(expr; kw...)
 substitute(expr, s::Vector; kw...) = substituter(s)(expr; kw...)
 
-substituter(pair::Pair) = substituter((pair,))
+function _unwrap_callwithmeta(x)
+    x = value(x)
+    return x isa CallWithMetadata ? x.f : x
+end
+function subrules_to_dict(pairs)
+    if pairs isa Pair
+        pairs = (pairs,)
+    end
+    return Dict(_unwrap_callwithmeta(k) => value(v)  for (k, v) in pairs)
+end
 function substituter(pairs)
-    dict = Dict(value(k) => value(v)  for (k, v) in pairs)
+    dict = subrules_to_dict(pairs)
     (expr; kw...) -> SymbolicUtils.substitute(value(expr), dict; kw...)
 end
 
diff --git a/src/variable.jl b/src/variable.jl
index 3dfae335e..15db8d35f 100644
--- a/src/variable.jl
+++ b/src/variable.jl
@@ -526,6 +526,7 @@ infinite loops in cases where the substitutions in `dict` are circular
 See also: [`fast_substitute`](@ref).
 """
 function fixpoint_sub(x, dict; operator = Nothing, maxiters = 10000)
+    dict = subrules_to_dict(dict)
     y = fast_substitute(x, dict; operator)
     while !isequal(x, y) && maxiters > 0
         y = x
diff --git a/test/utils.jl b/test/utils.jl
index 977bed6b9..727c53366 100644
--- a/test/utils.jl
+++ b/test/utils.jl
@@ -1,5 +1,5 @@
 using Symbolics
-using Symbolics: symbolic_to_float, var_from_nested_derivative
+using Symbolics: symbolic_to_float, var_from_nested_derivative, unwrap
 
 @testset "get_variables" begin
     @variables t x y z(t)
@@ -46,3 +46,12 @@ end
     expr = Symbolics.fixpoint_sub(x, Dict(x => y, y => x); maxiters = 9)
     @test isequal(expr, y)
 end
+
+@testset "Issue#1342 substitute working on called symbolics" begin
+    @variables p(..) x y
+    arg = unwrap(substitute(p(x), [p => identity]))
+    @test iscall(arg) && operation(arg) == identity && isequal(only(arguments(arg)), x)
+    @test unwrap(substitute(p(x), [p => sqrt, x => 4.0])) ≈ 2.0
+    arg = Symbolics.fixpoint_sub(p(x), [p => sqrt, x => 2y + 3, y => 1.0 + p(4)])
+    @test arg ≈ 3.0
+end