You defoliate to reduce the leaf size and to promote ramification. In deciduous trees it will help enhance the fall color. It will also help prevent shock when transplanting during active growth season.
You can defoliate most deciduous trees and broadleaf evergreens. You shouldn't do it to most flowering, fruiting or berry trees and not at all to conifers.
Only defoliate a young and healthy tree. You are forcing the next years growth, so an unhealthy or very old tree may fail to re-sprout and die.
When you defoliate cut every leaf off, leaving any leaves, especially the young tips, will encourage them to grow instead of others re-sprouting. You should cut at the base of the leaf, leaving some of the leaf stem. This will protect the dormant bud at the base of the leaf stem.
While the tree is defoliated you can get a good view of its branch structure, this is a good time to wire or make any other styling changes.
After defoliating keep the tree in a shady spot until new sprouts emerge and then start giving it more sun. The more sun the tree gets the smaller the leaves will stay and the better ramification you will have. Do not fertilize before or after defoliating. Be careful not to over-water as the tree will not dry out as soon with no leaves to transpire water.
Partial defoliation can be done on all species, but more commonly on species that cannot be totally defoliated. Do so by removing the larger leaves through the growing season until late summer. Also, you can partially defoliate larger or stronger branches to aid in the development of smaller or weaker branches. Reducing the leaves on the top of your tree will let in more light to the lower branches and encourage more growth there.
It is best to learn as much as possible about the species of trees you are growing so you will know when or if to defoliate, when to re-pot, wire and style. Doing so will enable you to keep your tree healthy for many years.
I defoliate my deciduous trees in April after the spring growth has completely hardened off. That is when the leaves have lost their spring green color and are getting stiffer. Waiting too long will actually increase your leaf size and lengthen your internode spacing.
I defoliate my Ficus in May after the night temperatures have been steadily in the 60's. I have done it right up to October without any problems but early summer is the best time. You can defoliate Schefflera, Fukien Tea, Phillipine Jasmine, Bougainvillea or just about any of your tropicals at this time of year.
After you have defoliated your tree and the leaves are growing back keep your growth tips pinched off. This will keep your growth further back in the branch, keep your internodes short and improve your ramification. In spring you will constantly be doing this to your deciduous trees, especially your Maples. Most of your tropicals and all of your Ficus will need their tips pinched throughout the entire growing season.