Old Penny Black is small and neat (5)
I believe the answer is:
dinky
'small and neat' is the definition.
(I've seen this before)
'old penny black' is the wordplay.
'old penny' becomes 'd'.
'black' becomes 'inky' ('inky' can be similar in meaning to 'black'**).
'd'+'inky'='DINKY'
'is' is the link.
(Other definitions for dinky that I've seen before include "Attractively small" , "Small, neat and cute" , "Neat and dainty" , "Dainty (colloq.)" .)