I'd go all the way to the bottom on both sides, I'd also likely add in a damp course too in the blocks.One thing Im unsure on is what you do with the inside of the planter block? If you render the top do you need to go down one block on the inside too? IVe read about people saying its worth tanking the inside with a waterproof paint or a membrane? My main concern is the water affecting the render on the front so would rather do it properly and pay an extra few quid if need be!
You can get specialist renders that have all this protection built in but obviously will cost considerably more so you'll likely end up doing a sand and cement render for a garden wall. You would normally then paint the cement render with external house paint, this is how our render is done with iirc sandtex. You'll likely need to repaint from time to time though.
On the inside you might be able to get away with a heavier duty 'paint' on the inside but I would at least ensure the 'blockwork' isn't directly exposed to the moisture as it could cause structural issues over a longer period.
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