In this article we study the validity of the Whitney $C^1$ extension property for horizontal curves in sub-Riemannian manifolds endowed with 1-jets that satisfy a first-order Taylor expansion compatibility condition. We first consider the equiregular case, where we show that the extension property holds true whenever a suitable non-singularity property holds for the input-output maps on the Carnot groups obtained by nilpotent approximation. We then discuss the case of sub-Riemannian manifolds with singular points and we show that all step-2 manifolds satisfy the $C^1$ extension property. We conclude by showing that the $C^1$ extension property implies a Lusin-like approximation theorem for horizontal curves on sub-Riemannian manifolds.