Island with a fee (5)
I believe the answer is:
atoll
'island' is the definition.
(I know that atoll is a type of island)
'with a fee' is the wordplay.
'with' says to put letters next to each other.
'fee' becomes 'toll' (toll is a kind of fee).
'a' next to 'toll' is 'ATOLL'.
(Other definitions for atoll that I've seen before include "tropical island" , "Land around a lagoon, such as Bikini" , "Coral island surrounding a lagoon" , "Key" , "Bikini for one" .)