Your heart rate will rise when you stand. That can be a downside if you are not fit and/or are shagged already and if there are more hills to come or you are racing.

It really depends on how you want to approach the hill. If you are merely trying to survive, then remain seated. If you are trying to save your legs, then stay seated until the going gets tough, then stand/sit as needed.

If you are trying to bridge a gap, then stand until you do, then sit.

If you want to hurt everyone behind you, then go to the front and stand up on every hill while looking back the whole time :-)