filters and canisters can be used, but they are difficult to maintain as they will need cleaned weekly. They also limit filtration methods in them. Sumps are preferred due to them increasing the water column along with assisting on hiding equipment. They aren't expensive and can even be as simple as an old tank or drinkable water safe container.
When it comes to water, don't use tap. It brings in all types of nasty levels that you can't even test for. Distilled water is the lowest one should go when it comes for a saltwater tank, especially if it is going to be a reef. You want as close to 0 total dissolved solids as possible so you can control what is going on in there without issues. I run my reef off of distilled water since getting married caused my kitchen to lose the ro
I ran in there. The result is algae that I battle pretty constantly. It gets worse with tap.