At last, Google has released a disavow links tool. This will really help to clean up years of linkbuilding abuse that gave businesses unfair ranking advantages or a while, until Google Penguin was released.
The disavow tool is available at:
http://www.google.com/webmasters/tools/disavow-links-main
and the news of the release can be found here:
http://googlewebmastercentral.blogspot.co.uk/2012/10/a-new-tool-to-disavow-links.html

When selecting the ‘Disavow links’ option, you are given a warning page:

Proceeding with the option, and with trepidation ignoring this warning from Google that it is an advanced feature, we get an upload lightbox:

Couldn’t resist an image test on the way đ

The text file must be smaller than 2Mb with one URL per line. Comments can be included in the file if prefixed with a #.
Where “domain:” tells Google to disavow links from all pages on a the âblognetwork.comâ site.
Specific pages can be disavowed by listing the complete URLs.
Only one disavow file per site is allowed and it is shared among site owners in Webmaster Tools.
Don’t expect overnight results, Google suggests that it may take up to 2 weeks for the submitted URLs to be re-crawled before the disavowed links have any impact. Also, a manual reconsideration request may still be necessary, after allowing a period of time to pass following disavow links file upload.
So this tool may not fix everything, but at least it helps with backlink cleanup following the Penguin algorithm release and updates.
This is a major step forward in promoting best practice by Google and I hope the tool doesn’t break !