WARNING: It has been brought to my attention that this process may have been broken yet again. Please proceed at your own risk with extreme caution.
The following is how you obtain and install Windows 8.1 on Parallels for Mac, as this has some potential pitfalls if you don't know the entire process, or are just starting out and are unclear about what to do. The process is simple, but takes a bit of time.
Instructions1. Purchase your Windows 8.1 license here, from Microsoft.
TECH NOTE: Whilst our final copy of Windows is going to be running in a virtualized environment, the Hyper-V functionality for Windows itself to run other virtualized environments is only installed on Windows 8.1 Pro and above, so if you are planning on doing any Windows Phone development, do not download Windows Basic as the simulator requires Hyper-V to be enabled - so get Pro, or Ultimate.
The option you want is the "download" one, shown here.
2. The Microsoft Store purchase won't show up immediately, so whilst that gets itself ready, install Parallels from here.
3. Go back to MicrosoftStore.com, your Windows key is probably now ready (look on right hand side for menu option marked "Purchases and Downloads") - make a note of it.
4. Now, here's where it gets a bit convoluted due to Microsoft needlessly creating a "chicken and egg" situation. They incorrectly assumed that your computer came preloaded with Windows, or you are upgrading from Windows. Therefore that "Download" option when you purchased Windows isn't actually a "Download" option for Windows. Surprise! There's a stub "WindowsSetup.exe" stub available, which runs under Windows (which you don't yet have). Download the install stub and put it somewhere safe - whilst it's useless right now, we can use it later.
5. When Parallels is installed, it will ask you if you want to download or install any OS's. Choose the Widows 8.1 Preview. This will download 3.5GB of files. Do not activate it, personalize it, install anything in it, etc. Just install as a trial for now.
6. When Windows 8.1 Preview is installed, do not install any Visual Studio 2013 software as it won't work on the preview. Go straight back to the stub you downloaded earlier and run it from within the Preview desktop. Enter your new Microsoft license key when prompted.
7. Windows will download and reinstall another entire 3.5GB copy of itself, when done, you now have a licensed full copy you can install your Visual Studio software on.
Ask yourself this: Why would someone purchase a full copy of Windows in download form, rather than a cheaper upgrade in download form?
Once you've wrestled with all of the possible permutations, you can't help but realize Microsoft was being lazy here. When selling their OS it's all packaged visually and textually like you're going to purchase a download copy of the OS - a disc image, or at least something that can be booted from.
Unfortunately, they incorrectly assumed that you were not purchasing the OS to bootstrap a clean drive or to install on a VM, so they assume the only other viable option - you already have Windows and ergo, they create a needless "chicken and egg" situation.
Compounding this logic failure, I personally ran into two failures by auxiliary staff. One is here, where they clearly misunderstood what virtualization is with comical effect:
...and the other was when I was told by sales support to "Download the disc", which is not an option.
All of this could have simply been avoided by doing one thing: When you have a choice of the physical DVD or a download (remember, this is not an upgrade copy, but a fresh/full install), make the download a full download.
Of course, this now begs the laughable question: If you purchase the physical DVD, does it too come with just a single stub file that you can't boot from either?