Can you change ruleset or faction later in WoW: Forever?

You can't move a living character from Normal, PvP or Roleplaying to another ruleset. Blizzard says so: "Players cannot freely hop between rulesets; to play under a different one, they’ll need to create a new character in that ruleset." That is confirmed.

Could a paid transfer come later? Nobody has said. Icy Veins reports that Forever "will not launch with the ability for characters to transfer", and that your ruleset will be your character's "permanent home for the forseeable future". That is reported. Players have asked Blizzard on its forums whether the choice is permanent, and Blizzard has not replied.

So choose as if it is for good. The choice itself is covered in choosing a ruleset.

There is exactly one confirmed transfer. When a Hardcore character dies, it can move to another ruleset, PvP included. Blizzard says this in two articles, so it is confirmed.

It does not help you on launch night. "Hardcore will be available sometime after launch", and it only works one way: a character can leave Hardcore by dying, but no character can move in. What it costs and what the character keeps are not published. The detail is in Hardcore: what's confirmed.

Faction is a separate question, and the PvP ruleset answers it hardest. Your first character on PvP locks the whole ruleset to that faction. Blizzard: "Once you create an Alliance character on the PvP ruleset, you won't be able to create a Horde character there, and vice versa." That is confirmed.

The other rulesets don't do this. On Normal and Roleplaying, and on Hardcore when it opens, you can make characters of both factions.

Why it exists and what it means for your group is in the PvP ruleset and its faction lock.

We found no source, from Blizzard or anyone reliable, on a faction change or race change for Forever. That is unknown, not a no. A player asked on Blizzard's forums whether these services will exist, and Blizzard has not answered.

Until Blizzard says otherwise, plan as if the race and faction you pick are the ones that character keeps. To play the other side, make a new character. On Normal and Roleplaying that is always possible. On PvP it is not.

Don't fill the gap with how other versions of WoW handle it. Forever is a new game, and nothing carries over by assumption.

Starting a new character on another ruleset is not starting from nothing. Collections and Legacy Points are shared across rulesets, with Hardcore as the exception. That is confirmed. What is shared, and what each character keeps for itself, is in Legacy Points and collections.

One thing does not come with you: the name. Blizzard confirms that full names are unique per region. Blizzard Watch reports that a full name can be used by only one character across all the rulesets. If that is right, a new character on another ruleset needs a different name while the old one exists. More in names and language.