When starting a band the last thing you are likely to think of is the legalities behind such a set up. After all, you’re starting the band to make music, not litigate.
Despite that, you really ought to take legal rights and contracts in to account, even in the early stages of your bands career - in fact, especially so. it’s particularly important to establish a Band Partnership Agreement early on (I’ve set up a link so that you can download a free one here). A band agreement establishes how royalties will be split and who owns copyright - all highly important factors when money is brought in to the equation.
It may be that you feel you don’t want to display such distrust in each other, but to look at in this way is naive, unless you only want your band to remain a hobby rather than a profession. Contracts are taken out and used all the time - if you were employed by a company you would need to sign a contract with them, so consider it in the same way. If anything, making clear lines of demarcation will help to make things easier. It’s also far easier to iron out any differences of opinion at the start when there is little or no money involved, rather than when there is.
You will need to take in to account things like song writing royalties, who owns copyright of the material, the name and what will happen to future earnings and division if someone leaves the band. Other practical issues may include ownership of equipment and payment of expenses.
There will also be other contracts that you will need to consider and negotiate that incorporate individuals outside of the band. This may include freelance musicians, photographers, stylists, promoters and so on. It’s important to establish in writing what remuneration as and when the band start to make money.
As the time comes, if you go down the non-DIY route you will also need to draw up contracts with any production companies, agents, or record labels who will take a portion of your earnings as recompense for investing time, money and marketing in your band. You will need to factor this in to the band agreement, too, or otherwise incorporate it in to the agreement when the time comes.