Terahertz (THz) band is currently envisioned as the key building block to achieving the future sixth generation (6G) wireless systems. The ultra-wide bandwidth and very narrow beamwidth of THz systems offer the next order of magnitude in user densities and multi-functional behavior. However, wide bandwidth results in a frequency-dependent beampattern causing the beams generated at different subcarriers split and point to different directions. Furthermore, mutual coupling degrades the system's performance. This paper studies the compensation of both beam-split and mutual coupling for direction-of-arrival (DoA) estimation by modeling the beam-split and mutual coupling as an array imperfection. We propose a subspace-based approach using multiple signal classification with CalibRated for bEAam-split and Mutual coupling (CREAM-MUSIC) algorithm for this purpose. Via numerical simulations, we show the proposed CREAM-MUSIC approach accurately estimates the DoAs in the presence of beam-split and mutual coupling.