I created an account and posted this on the Handbrake board about 6 hours ago and my post still has not been approved by a mod.
I have the paid version of MakeMKV and I ripped my Blu Ray copy of Game of Thrones Season 3. I included regular and forced English subtitles. The mkv plays perfectly in VLC and XBMC. The forced subtitles work by default and I can turn on/off the regular subtitles as well. I have tried several times to use Handbrake to compress the mkv (high profile setting with mkv container) and can not get the subtitles (forced or regular) to work. I am using the nightly build of Handbrake.
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HandBrake has a support forum too. So as long as you provide the HandBrake Activity Log, we should be able to help you over there.