Safari in OS X Yosemite comes with a brand new Tab View to help you manage open tabs in Safari. You can toggle the Tab View using Shift-Command-\ keyboard shortcut, from menu View > Show All Tabs, pinching on the trackpad or click on the tab view button located on right top corner of Safari window.
Tab View displays all your open tabs in grid of thumbnails. Each thumbnail is a preview of the content of the website. This gives you a visual clue to easily switch to a particular site by clicking on the thumbnail. To close a tab, mouse over the thumbnail and click on the X icon on the upper left corner.
Just below the thumbnails is a list of open tabs on your other iCloud enabled devices. Thus tab view in essence replaces the old iCloud Tabs button. The ability to access open tabs on other devices is one convenient feature to allow you to continue viewing a site on your Mac. When you mouse over a link, you can click on the X button at the end of the tab title to close the tab. If you find closing Safari tabs on small iPhone screen cumbersome, you can now close them on a Mac.