If you’ve updated by command line, MyOSMC will always report an update available until either reboot (i think this may solve it, not certain) or MyOSMC has attempted to check for updates and found none pending.
Rebooting will not remove the update notification but doing a manual update check in My OSMC and allowing it to run to completion where it says no updates found will remove the icon.
Seems like Kodi got upgraded but kernel did not. Had to re-run the upgrade and it completed this time. After that all kinds of weird bugs started to appear so I had to reflash the SD card and redo it. Fine after that.