The 17-year-old forward, the grandson of former Leeds, Juventus and Wales international John Charles, joined Town's academy at under-11 level before going on to sign his first professional deal earlier this year, which was due to run until next summer.
Charles is yet to make his first-team debut for the Terriers but, as a first-year scholar, managed four goals in 29 appearances for the club's under-18 and under-21 sides last term and has already equalled that number this season.
Academy manager Mark Lillis told Town's official website: "The club has plenty of belief in its young players.
"It shows the club's confidence in Jake to offer him a new contract and he now has time to develop here as a young footballer.
"Jake has set off this season really well, but he is still learning the game and will continue to listen and develop.
"He is playing in the 'number 10' role at the moment, which he has adapted to really well and scored a few goals from, including a hat-trick at Sheffield Wednesday."