Is it possible to test my windows phone 8 app on an actual device, like Nokia Lumia 820 (NOT Simulator) before submitting to store? How?
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You can now register one phone without a developer account, as you can see in the prerequisites of registering a phone:
http://msdn.microsoft.com/en-us/library/windowsphone/develop/ff769508%28v=vs.105%29.aspx
You only need to have a Microsoft account (not a developer account), to which you can register the phone you want to test on. Microsoft also changed the limitations on how many phones you can register with that developer account: they are only three by now. I did not find an official statement on these changes, but they must have been taken quite recently...
After you downloaded the WP 8 SDK from the Microsoft Download Center, go to "All Apps" on your computer and choose "Windows Phone Developer Registration".