Body of water in Scotland with water-beast? Pshaw! (3,4)
I believe the answer is:
sea loch
'body of water in scotland' is the definition.
(Scottish term for a lake)
'with water-beast? pshaw' is the wordplay.
'with' means one lot of letters go next to another.
'water-beast?' becomes 'seal' (aquatic animal).
'pshaw' becomes 'och' (both are expressions of impatience).
'seal' next to 'och' is 'SEA LOCH'.
(Other definitions for sea loch that I've seen before include "Scottish water" , "Arm of the ocean (Scotland)" , "Lake-like arm of salt water in Scotland" .)