Item that's spare? Good! (5)
I believe the answer is:
thing
'item' is the definition.
(both can mean an object)
'spare? good' is the wordplay.
'spare?' becomes 'thin' ('thin' can be similar in meaning to 'spare').
'good' becomes 'g' (abbreviation).
'thin'+'g'='THING'
'that's' acts as a link.
(Other definitions for thing that I've seen before include "Object, artefact" , "Object; gadget" , "cup of tea" , "Affair - matter" , "Individual unit" .)