I don't know anyone that offers a fully free both ways service (why would anyone?).
Most modems come with a CD which has a faxing program. This if fine for sending. You will have to pay the phone call, as with a fax machine.
For receiving, a free service which converts your incoming faxes to email is really good news, as don't have to leave your system on in fax reception mode for a start. Try click here - they seem to have restartd their free service, with fax numbers in the UK available. Also some ISPs may offer such a service (Tiscali do in Spain).