Preheat the oven to 170 C. Grease or use non-stick baking paper to line an 8 inch round cake tin or springform pan.
In a mixing bowl, beat the butter and sugar with a hand mixer on low speed until pale and creamy. Add the vanilla and peanut butter again and beat briefly to combine.
Now add the eggs and beat again until they're incorporated. Sift in the flour, baking powder and salt (if using). Fold gently to combine, then stir in the milk to make a smooth but thick batter. Do not over mix it.
Now spread half the batter into the base of your cake tin and smoothen it out. Drop teaspoonfuls of half the Nutella over the batter and use a toothpick to swirl it around (see photo in the post above).
Spread the remaining batter over this and then swirl the other half of the Nutella over the top.
Bake for 35 to 40 minutes until a toothpick poked in the center comes out clean or with just a few moist crumbs, no wet batter.
Let the cake cool in the tin for 20 minutes, then place it on a wire rack to cool completely (I find a springform pan more convenient because you can just remove the sides and let the cake cool).
Slice and dig in! Store the cake in an airtight tin for 2 days at room temperature and in the fridge for a week. It can also be frozen for longer. Happy baking!