years ago i used some software, where you could fax. It would dial out using your modem and connect directly to the recipients fax machine. It was free.... but then again almost everything on the net was free then.
There are several sites now that allow you to send faxes from your pc, but as far as im aware you have to pay. There are a couple of companies doing a 30-day-free trial thing but if your wanting to faxes regulary its a waste of time really.
What I would recommend, is that you buy an "all in one printer". Ive got one - its a printer / scanner / photocopier / fax machine. e.g
http://www.pcworld.co.uk/martprd/store/pcw_pag e.jsp?BV_SessionID=@@@@0707065665.1156291089@@ @@&BV_EngineID=ccdjaddijefijggcflgceggdhhmdgmk .0&page=Product&fm=null&sm=null&tm=null&sku=40 2858&category_oid= This printer is taken from the PC world website. Its about �80 but is pretty reasonable.
Just to note, if you do decide to buy the above printer (or anything else from PC world) and want it asap. You can buy online and select "pick up in store" (or something the like). Wait an hour, then go to your local PC world and pick it up. (usually saves you around 20% as you pay the internet price and not the store price).
Other than that, im sure you'll be able to pick up a cheap fax machine on ebay!