This is due to the sealing washer between the cistern and toilet pan being broken or distorted. It called a doughnut washer - because of its shape. It needs to be replaced, which means that the cistern has to be disconnected from the pan to get access. Available from B&Q etc they cost around £2, and its a good ideal to spread some silicone sealant around the edges for good measure when the two parts are brought together again.
John, April 2009
