Heat oil in a deep pot or fryer to 350°F (175°C) for frying.

In a medium bowl, whisk together all-purpose flour, granulated sugar, baking powder, and salt until evenly mixed.

In another bowl, whisk milk, egg, and vanilla extract until smooth.

Gently pour the wet ingredients into the dry mixture, stirring until just combined to avoid overmixing.

Drop spoonfuls of batter into the hot oil; fry for about 2-3 minutes on each side until golden brown.

Remove the donuts using a slotted spoon and allow them to drain on paper towels.

While still warm, dust the finished donuts with powdered sugar or roll them in cinnamon sugar.