diff --git a/CHANGES.md b/CHANGES.md
--- a/CHANGES.md
+++ b/CHANGES.md
@@ -17,6 +17,8 @@
 For user-visible changes, see the hledger package changelog.
 
 
+# 1.50.5 2025-12-08
+
 # 1.50.4 2025-12-04
 
 # 1.50.3 2025-11-18
diff --git a/Hledger/Read/JournalReader.hs b/Hledger/Read/JournalReader.hs
--- a/Hledger/Read/JournalReader.hs
+++ b/Hledger/Read/JournalReader.hs
@@ -318,7 +318,7 @@
     ) <|> errorNoArg
 
   let (mprefix,glb) = splitReaderPrefix prefixedglob
-  parentf <- sourcePosFilePath pos   -- a little slow, don't do too often
+  parentf <- sourcePosFilePath pos
   when (null $ dbg6 (parentf <> " include: glob pattern") glb) errorNoArg
 
   -- Find the file or glob-matched files (just the ones from this include directive), with some IO error checking.
@@ -378,7 +378,8 @@
       expandedglob <- lift $ expandHomePath globpattern `orRethrowIOError` "failed to expand ~"
 
       -- get the directory of the including file
-      let cwd = takeDirectory parentf
+      -- need to canonicalise a symlink parentf so takeDirectory works correctly [#2503]
+      cwd <- fmap takeDirectory <$> liftIO $ canonicalizePath parentf
 
       -- Don't allow 3 or more stars.
       when ("***" `isInfixOf` expandedglob) $
diff --git a/hledger-lib.cabal b/hledger-lib.cabal
--- a/hledger-lib.cabal
+++ b/hledger-lib.cabal
@@ -5,7 +5,7 @@
 -- see: https://github.com/sol/hpack
 
 name:           hledger-lib
-version:        1.50.4
+version:        1.50.5
 synopsis:       A library providing the core functionality of hledger
 description:    This library contains hledger's core functionality.
                 It is used by most hledger* packages so that they support the same