Good advise so far, but I'll elaborate on the procedure.

Drill the hole with the proper size drill

Place a drop of oil in the hole. Cutting oil is recommended, but anything from WD-40 to cooking oil will work. Put a little on the tap as well.

I don't bother with any gauges to keep it straight, but I have a good eye. Keep looking at it from several angles at first to make sure you're going straight. Once you've got it going straight, you don't need to keep checking - it will follow the hole.

The next thing is - after the first few turns, back off far enough so that the flutes break the chip behind it. Continue to cut, but back-off to break the chip about every half-turn.

If at any time it becomes hard to turn STOP and turn the tap completely out. Clear the hole, re-oil and start again.

If it gets really hard to get out, STOP and screw it back in slightly and try to knock some of the chips out of the hole.

The most important thing to avoid is breaking the tap in the hole - do that and you're screwed.