Combine your sugar and water in a heavy saucepan. Note that the must be large enough to allow whisking in the Heavy cream later, you will need some space as it will be hot and bubble.
Bring the stove top to a medium heat (170 C) and let the sugar liquify. It will start to simmer, let it cook until you get a deep amber colour. If you need to mix the caramel DONT use a spoon, instead swirve the the saucepan carefully. Using a spoon or spatula will crystallize the caramel.
As soon as you reach the deep amber colour, take the pan off the heat and while continuously whisking add the heavy cream in a slow but constant stream. This will bubble and steam profusely. Keep whisking until you have a smooth sauce. Note:If your get clumps then you haven't whisked fast enough. This can also cause the caramel to separate when it cools down. Whisk in the salt and vanilla extract, pour in to a Jar and let it cool before putting it in to the fridge.