Independent business next to a holiday location (5)
I believe the answer is:
ibiza
'holiday location' is the definition.
'independent business next to a' is the wordplay.
'independent' becomes 'i'.
'business' becomes 'biz' (biz is a kind of business**).
'next to' is a charade indicator (letters next to each other).
'i'+'biz'+'a'='IBIZA'
(Other definitions for ibiza that I've seen before include "Spanish island" , "Mediterranean location" , "Mediterranean island" , "Westermost of Balearic Islands, popular for holidays" , "One of matching pair" .)