A tool that has been a mystery to webmasters, Google Disavow can help your website if you have received manual penalty e-mail from Google, or been plagued by poor link building techniques. Although, the tool is extremely popular, very few webmasters know how it works and how to use it properly. However, one thing that we do know is Google frowns upon the incongruous use of the tool. Most tools and products by Google become a favorite of online businesses and e-marketers, but few have produced rumor, speculation and fear and Disavow Tool is one of them. Hardly anyone outside Google understands exactly how this tool works and very few know how to make the most of it. 
The moment you login to this tool, Google warns you and asks you to be cautious. Here’s what the welcome message says – 
When this tool was introduced, most webmasters were expecting a miracle. They thought that it is a wonder tool that is created to remove all ‘spam’ links from their websites. In fact, some of them were stunned when the tool did nothing to their submission files. Google made it clear in the beginning that using this tool should be the last resort for webmasters. Before using this tool, make sure to make multiple link removal requests, and once, very few links are left to remove, you should use this tool.
You can examine the links by using Google Webmaster Tools. Now, you do not require using any third party backlink, you can use Webmaster Tool to examine the links and get manual penalties removed. Analyze links data and keep in mind that any link that does not conform to the webmaster guidelines should be deleted.
You can create a Google Drive account, dedicated exclusively to your link cleanup campaign. Gather and record every detail related to your outreach campaign on a spreadsheet. After that, include your Google Drive credentials in your report. This works in your favor because it allows Google to be able to look at your work on the spreadsheets.
While sending the request, make sure that your e-mails are direct, informative and do not require any thought on the part of the recipient. Mention the position of the link clearly, along with information on anchor text. By including these details, you will be perceived as human and not a bot. This makes it easy for the webmaster to find your links and remove them. Browse the web to look for sample link removal requests before creating yours.
Login to Webmaster Tools, go to Disavow and select your domain. The moment you click on Disavow Links, you will see a menu asking you for a file that contains the links that you require to disavow. This list includes any remaining link that you could not get removed by sending requests to webmasters. Upload the files and you are done. Keep in mind that some webmasters have started asking for money for removing your links, do not fall into this trap. Instead, mention ‘asking for money’ in your spreadsheet on Google Drive.
This is optional. If Google does not remove manual penalty in the first attempt, you might send a reconsideration request after a few weeks or months. While filing the request, make sure to –
It is very important to keep in mind that any website that receives manual penalty once is in a critical state and webmasters should be extremely cautious.
Additional Information
The whole process may take time and even months. This tool, when used alone might not be extremely effective means for a webmaster to recover from penalty. There is a reason why Google warns the users before using this tool. If used inappropriately, the tool may harm your website. From this statement, it is quite clear that Google does not want webmasters to use this tool if they are unaware about what they are doing.
