In a medium sized saucepan, combine the sugar and the water. Stir just until combined.
Place the saucepan over medium heat. Let the sugar mixture cook, without stirring, until the sugar mixture turns a mid amber color. Take the mixture off the heat to stop the cooking process.
Add the butter to the saucepan and whisk to combine. Be very careful as the mixture is incredibly hot and will bubble up and steam when the butter is added.
Whisk in the heavy cream, followed by the vanilla and the salt. Whisk until smooth.
Let the caramel cool in the pan for 10 minutes before transferring to a storage container to cool completely.