HMRC help please

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Can anyone please advise as I've looked at this for a relative and am thoroughly confused, they have been issued a late filing penalty for not submitting a tax return, but did not do so as they earned less than £1,000 in that tax year before stopping self employment. They declared they were no longer self employed and filed a request to be removed from self assessment after the HMRC checker said they did not need to file a return for that year due to low income.

They have not yet received any confirmation from HMRC as to having been removed from self assessment (meant to be within 15 working days from end of January when they filled in the form), and I am wondering which of these 2 options is more likely -

A) HMRC have just not yet processed their declaration, the final tax return isn't needed and the penalty is not due and so they should state this in appeal?
B) They have completely misinterpreted the guidance, should have still filed a final return, and now need to do so and grovel?

Any insight would be welcomed!

If you're self employed, you HAVE to file a tax return regardless. Even if you have earned 0, you still have to tell them. I'd imagine this is still the case, even if you have de-registered from Self employment

You still have to submit a £NIL return

The £1,000 rule is to do with registering as self-employed and doing a tax return. If you earn below that threshold then you don't have to register.

Once you are already registered as self-employed you still have to do a tax return every year even if you make a loss or cease trading. In this case, since it appears from what you say they de-registered part way through the tax year, then they should have filed a return, covering the period from the start of the tax year until the date they ceased self-employment.

What date did they give as the day they stopped being self-employed?