This seems to be a really common question around forums at the moment which is causing a lot of head scratching and general wondering.
In essence the issue is that once you declare a record within any site, regardless of whether this is a Records Center, Records Library or a team site that you loose the ability to delete the list/library, even after you remove the offending record.
So say for instance that we have a Records Center and Records Library like below. In it we have one record declared.
If we now try to delete the library by going to library settings there is no delete option! So most people will undeclare the records first, then remove it. This is pretty simple to do, simply go to Record Declaration Settings, untick the ‘Automatic Declaration’ tick box, and change the ‘Manual Record Declaration Availability’ setting to Always allow the manual declaration of records.
From there go to the compliance details of the Record, undeclare it, and finally delete it. Quite a few steps!
So now you would think that because you have deleted the record that you should be able to delete the list but,alas you still cant.
The secret is that when a record is undeclared from a library SharePoint has no way of knowing if there are other elements in the library that are records without scanning the entire library every time. If there are many thousands of documents or items this is simply too expensive.
The solution is to run the “Hold Processing and Reporting” timer job after removing all holds and undeclaring all records in a list. This will do the work on the list to determine whether or not it can be deleted again (contains no records or items on hold), and if so add the delete option back to the list settings page.
By default this timer job is set to run once per day, hence why people think that they are going crazy as they cant delete a library one day, and the next day they can. So go to Central Administration –> Monitoring –> Job Definitions and run this job.
Now assuming that we have no more Records in the list the delete option will be available and you should be all ready to go! This will work if you are using In-Place records management as well for any libraries or lists.