Old community found in outskirts of British wood (5)
I believe the answer is:
beech
'wood' is the definition.
(beech is a kind of wood)
'old community found in outskirts of british' is the wordplay.
'old community' becomes 'EEC' (predecessor to the EU).
'found in' is an insertion indicator.
'outskirts of' suggests removing the centre.
'british' with its middle removed is 'bh'.
'eec' going into 'bh' is 'BEECH'.
(Other definitions for beech that I've seen before include "Common deciduous tree" , "Nut-bearing tree" , "Common forest tree" , "Tree of Fagus genus" , "It has branches" .)