The most common and most likely answer to this crossword clue is the 7 plus 5 letter word MORNING DRESS
I've seen this crossword clue in The Daily Telegraph
M
O
R
N
I
N
G
D
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E
S
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Buddy explains!
The straight part
We know that "Sounds suitable wear for an early funeral" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case sounds suitable wear for an early funeral = morning dress.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.