Do Subdomains Assist or Hamper SEO

Do I use a subdomain or a new directory?

[Stronkie]

My client is a charity that wants to set up a subdomain for fundraising events i.e. www.fundraising.maindomain.org

Will this assist our SEO efforts on the main domain? Will the search engines see this as a completely new domain?

My gut feeling is that it will have little or no effect, but if any, it will add to existing efforts rather than take away.

I have suggested they use www.maindomain.org/fundraising
but they already have other content there.

[Webwork]

One theory is that subdomains are more likely to be "sandboxed" than a new directory extension to the root domain.

Other than that there's little consensus that one version has an edge over the other.

Of course, since algos are tweaked from time to time that all could change overnight. That's always the truth so don't hang onto any idea too tightly.