The most common and most likely answer to this crossword clue is the 7 letter word ORKNEYS
I've seen this crossword clue in The Times
O
R
K
N
E
Y
S
More clues leading to the result ORKNEYS
Buddy explains!

The straight part
We know that "Where, finally, crofter on Skye moved?" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case where, finally, crofter on skye moved? = orkneys.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.