Plumbing Question - Basic

[h20man]

I am finishing up the plumbing on a new reef ready tank with corner overflows (drilled bottom) with durso pipe - Perfecto reef ready system. It has been awhile since I have had a tank and seems like you need to make sure the return from the tank into the sump ends just above the water line of the sump - so the pipe does not extend below the surface in sump. Is this correct?
Or can the return pipe extend under the surface of the water in the sump?

Thanks