Preheat the Oven:
Preheat your oven to 350°F (175°C). Grease and flour two 8-inch round cake pans or line them with parchment paper.
Prepare Dry Ingredients:
In a medium bowl, whisk together the flour, baking powder, baking soda, and salt. Set aside.
Cream the Butter and Sugar:
In a large bowl, beat the butter and brown sugar together until light and fluffy (about 3-4 minutes) using an electric mixer or stand mixer.
Add the Eggs and Vanilla:
Add the eggs, one at a time, beating well after each addition. Stir in the vanilla extract.
Alternate Adding Wet and Dry Ingredients:
Gradually add the dry ingredients (flour mixture) to the butter-sugar mixture, alternating with the buttermilk, starting and ending with the dry ingredients. Mix just until combined.
Fold in Butterscotch Chips:
If using butterscotch chips, fold them into the batter.
Bake the Cake:
Divide the batter evenly between the prepared cake pans. Bake for 25-30 minutes, or until a toothpick inserted into the center comes out clean. Allow the cakes to cool in the pans for 10 minutes, then transfer to a wire rack to cool completely.
For the Caramel Icing:
Make the Caramel:
In a medium saucepan, melt the butter over medium heat. Add the brown sugar and heavy cream, stirring to combine. Bring the mixture to a gentle boil, and let it cook for about 2-3 minutes. Stir frequently to avoid burning. Remove from heat.
Add Vanilla and Salt:
Stir in the vanilla extract and salt.
Mix in Powdered Sugar:
Gradually whisk in the powdered sugar, 1/4 cup at a time, until the icing is smooth and has reached a pourable consistency. If the icing is too thick, add a little more cream or milk to reach the desired texture.
Cool the Icing Slightly:
Allow the caramel icing to cool for a few minutes before applying it to the cake. The icing should be slightly warm but not too hot.
Assemble the Cake:
Frost the Cake:
Once the cakes are completely cool, place one layer on a serving platter or cake stand. Pour a generous amount of the caramel icing over the first layer, spreading it evenly.
Top with Second Layer:
Place the second cake layer on top, and pour the remaining caramel icing over the top of the cake. Let the icing drip down the sides.
Serve:
Allow the icing to set for a few minutes before slicing and serving. Enjoy the sweet, decadent layers of butterscotch cake with caramel icing!