Thermal bridges at window installations significantly influence the energy performance and indoor comfort of buildings, particularly in nearly Zero Energy Buildings (nZEB). Even in well-insulated and airtight building envelopes, improper window integration can cause substantial localized heat losses and increase the risk of surface condensation and mould growth. This study investigates the impact of window mounting position on thermal bridge intensity at window-to-wall junctions. Finite Element Method (FEM) simulations were used to analyse heat transfer in representative junction configurations. Mounting depth, frame alignment relative to the insulation layer, and junction detailing were systematically varied to determine their effect on linear thermal transmittance (Ψ-values). The simulations show that relatively small changes in mounting position can significantly reduce thermal bridge effects. The lowest heat losses and highest internal surface temperatures — thus lowest condensation risk — were achieved when the window frame was positioned in the insulation layer and partially embedded within it. Application of these optimized installation details in a case study of a historical building retrofitted to Passive House (PH) standard resulted in a measurable reduction in annual heating demand and a favourable payback period. The findings demonstrate that careful window positioning during installation is an effective and economically viable measure to improve the energy performance and durability of high-performance buildings.