Laser induced ultrafast demagnetization is a powerful process by which the magnetic moment of a material can be modified on femtosecond timescales. However, to eventually utilize this process in technology, it is crucial that we develop a thorough understanding of the physical mechanisms involved. Based on ab initio simulations, spin-orbit mediated spin-flips have been proposed as one form of ultrafast demagnetization. In this paper, we explore this mechanism in more detail using time-dependent density functional theory (TDDFT) to study demagnetization in bulk Ni. We show why spin-orbit coupling (SOC) causes spin-flips by highlighting the importance of circulating spin currents induced by the coupling between the electronic spin and orbital motion. We present both a mathematical and heuristic picture of how SOC can cause demagnetization. Furthermore, we show that same arguments can be used to understand how the spin angular momentum is transferred to the lattice during laser induced demagnetization in a realistic material.