Fix milestone quick action

Handles ancestor group milestones by passing in the ancestor group ids
to MilestonesFinder

app/services/quick_actions/interpret_service.rb

@@ -84,7 +84,9 @@ module QuickActions
     # rubocop: enable CodeReuse/ActiveRecord
 
     def find_milestones(project, params = {})
-      MilestonesFinder.new(params.merge(project_ids: [project.id], group_ids: [project.group&.id])).execute
+      group_ids = project.group.self_and_ancestors.select(:id) if project.group
+
+      MilestonesFinder.new(params.merge(project_ids: [project.id], group_ids: group_ids)).execute
     end
 
     def parent

changelogs/unreleased/25250-can-t-use-quick-action-to-set-milestone-when-the-project-only-has-m.yml

+---
+title: Fix milestone quick action to handle ancestor group milestones
+merge_request: 22231
+author:
+type: fixed

spec/services/quick_actions/interpret_service_spec.rb

@@ -856,9 +856,10 @@ describe QuickActions::InterpretService do
     end
 
     context 'only group milestones available' do
-      let(:group) { create(:group) }
+      let(:ancestor_group) { create(:group) }
+      let(:group) { create(:group, parent: ancestor_group) }
       let(:project) { create(:project, :public, namespace: group) }
-      let(:milestone) { create(:milestone, group: group, title: '10.0') }
+      let(:milestone) { create(:milestone, group: ancestor_group, title: '10.0') }
 
       it_behaves_like 'milestone command' do
         let(:content) { "/milestone %#{milestone.title}" }