Catagories and sub catagories

I am tidying up my site would like to add sub catagories to my catagories

It doesn't give me this option anymore...

I have just had the site upgraded so can anyone help?

Thanks

If you have products in a category, you cannot add a sub-category at the same level.

Work-around: Create a new top-level category (call it something like Temp) - disable it by clicking the green status button. Now go to the category you want to add sub-cats to: move all the products into the new temporary category you just created. Now you can add sub-cats to your category. Move all the products from the temporary category into the sub-categories that you want them in, then delete that temporary category.