Are you sure it is charcoal and not activated carbon? Here is an excerpt from an article...
Let's consider activated carbon and its supposed evil twin, charcoal.
Just a decade or two ago, the common advice was to put carbon in the filter. The only problem was that some fish stores sold what was little more than crushed anthracite. anthracite is a dense form of coal deposit very high in carbon and is more effective for stoking a fire. It was, however, less expensive, compared to the activated carbon next to it on the shelf.
What makes high quality filtration carbon work is its porosity. The pores, which vary in size, add significantly to the total surface area available to capture chemical molecules. To become activated, the carbon is subjected to heat of 2,000 degrees Fahrenheit in special ovens.
Activated carbon is a selective filtering medium. It filters in two ways: by absorbing certain kinds of molecules and by catalyzing a few others. We will consider this further in a bit, but that is the general point, most of the filtration that activated carbon performs is by adsorption (adsorption is the accumulation of gasses, liquids, and solutes on the surface of a solid or liquid) - carbon attracts and holds differently sized molecules within it differently sized pores. The pore size needs to match the molecules for carbon to be effective. For large types of molecules, the pore size needs to be large. However, not all kinds of molecules are adsorbed by activated carbon.
To put it plainly, activated carbon does not effectively filter metals and salts. It will not remove iron, magnesium, phosphates, or potassium, or any other trace elements that plants like. Activated carbon won't hurt your plants. On the other hand, for better or worse, it will not remove alcohols, glycols, ammonia, strong acids or bases, or most inorganic minerals such as sodium. Interestingly, activated carbon does adsorb iodine very well, and a given sample of activated carbon's ability to adsorb iodine is used to rate the carbon's total surface area and general filtering capability.
Activated carbon is terrific at filtering many organic compounds. It filters phenols but doesn't filter out alcohol. It works well for tannins, which tend to be large molecules; carbon with large pores works best for tannins. Activation carbon does help remove some chemicals (e.g., chlorine, phenols, some hydrocarbons) from aquarium water that could become toxic if they are allowed to accumulate in large amounts.
Remarkably, activated carbon is great at catalyzing chlorine into a harmless form. In the catalytic reaction, the carbon transfers electrons to the chlorine molecule, making the chlorine a reduced, nonoxidative ion. The chlorine passes right through the carbon, but it becomes harmless on the way. It also - much more slowly - breaks up chloramines, rendering the chlorine as a reduced ion, though the ammonia component remains; this is all right if you have plants to absorb ammonia , but in a fish-no-plants tank, you would still need to treat the ammonia with a neutralizer.
So activated carbon will do a really good job of filtering out some things, such as many kinds of medications and many dissolved organic compounds that build up in aquarium water. Also, it renders chlorine harmless. Thus, carbon has some benefits for a planted aquarium. Unfortunately, after just weeks in the aquarium water, the activated carbon becomes so loaded with bacteria that it performs pretty much like...well, anthracite. Also, it's not much use for treating chlorine, unless you pass the chlorinated water through the carbon before it passes over the gills of your fish, which doesn't happen when the carbon is in a canister or hang-on-the-back filter.
