The SmugMug structure available looks like this:
category > subcategory > gallery (containing photos)
So yes, you'll be able to create a Australia 2010 category and then within that create subcategories for each month. Going with your example, it could like this:
Australia 2010 > January > first gallery
> second gallery
> February > first gallery
> second gallery
etc.
Of course, the use of subcategories would only make sense if you were to have 2 or more galleries per month.
To create a category or subcategory, go to the account settings > style section. There you'll be able to manage categories and subcategories.
For detailed information on using categories and subcategories, you can also check out this post.
Note that your homepage may be set to show all galleries. If you don't see categories on your homepage, look at the top right of the galleries box. There you should see the "display: categories • galleries" option. Clicking on categories should change your homepage to display categories instead of all galleries.