I am now about to register a business for myself and I am going to have to make claims on income tax, etc... Also I will need proof of purchases with receipts. I was just wondering how you guys handle them online, if you were to allow a customer to download the full version after buying, would you then mail then the receipt? Or do you not give them one at all :p

Our order processor automatically sends out a receipt via email once the purchase is approved. The merchant account provider does that for us. We can turn these off or edit the formatting to some degree.

What if I would be using paypal to handle all my orders. I doubt they have this feature also, or do they?

If you use paypal, you can use their IPN feature, which calls a web page on your server when a transaction is complete. You can use that script to send email receipts, setup download links, etc (but the user doesn't see that script in their web browser, so don't expect to output any info for them).