Rest peacefully by a river with Scot on the bank (8)
I believe the answer is:
riparian
'on the bank' is the definition.
(riparian means by a river bank)
'rest peacefully by a river with scot' is the wordplay.
'rest peacefully' becomes 'RIP' (rest in peace).
'by' means one lot of letters go next to another.
'river' becomes 'r' (abbreviation for river).
'with' says to put letters next to each other.
'scot' becomes 'ian'.
'rip'+'a'+'r'+'ian'='RIPARIAN'
(Other definitions for riparian that I've seen before include "Relating to a riverbank - Iran pair (anag)" , "along river bank" , "living by the river" , "near a river" , "associated with banks" .)