Calibrating and validating hydrological models like SWAT using data from a single subbasin in a larger watershed, known as sub-basin calibration and validation, is a common practice. The rationale is to focus on calibrating the model for a specific area first, to understand and improve its performance, before applying it to the full watershed model. However, the discharge gauge site used for calibration preferably is at the outlet point for the entire watershed. Using a site partway along the watershed risks missing major tributaries, limiting how representative the calibration is for the overall watershed flows. The best practice is to use the most downstream gauge site encompassing all tributary flows for initial subbasin calibration and validation. This helps ensure the model is properly calibrated before expanding to the full watershed. However, as mentioned, even in the absence of a gauge at the watershed outlet, one can leverage sub-basin streamflow data, particularly when the hydro-climatic and physiographic characteristics of the watershed closely resemble each other. Alternatively, one may consider employing a rating curve established at the outlet by the relevant authorities (Minster of Water) or drawing upon published research specific to that area.
Using a single subbasin for both calibration and validation is not ideal. It is best to calibrate on one subbasin and then validate on another. If you have multiple years, than it may be possible to calibrate for say the first five years and then validate for the next five years. I have attached a paper where we got in a bit of trouble using this approach in a snowmelt study because the instrumentation changed between the calibration and the validation periods (see page 1179, column 2), and also the weather was not the same during the two periods. We have also had trouble with such approaches in some of our post wildfire or following tree harvesting studies because the land cover changes between the calibration and the validation periods. Such are the challenges of hydrologic modeling.