Formulating appropriate simulation models that capture the microstructure evolution at the mesoscale in metals undergoing thermomechanical treatments is a formidable task. In this work, an approach combining higher-order dislocation density based crystal plasticity with a phase-field model is used to predict microstructure evolution in deformed polycrystals. This approach allows to model the heterogeneous reorientation of the crystal lattice due to viscoplastic deformation and the reorientation due to migrating grain boundaries. The model is used to study the effect of strain localization in subgrain boundary formation and grain boundary migration due to stored dislocation densities. It is demonstrated that both these phenomena are inherently captured by the coupled approach.